- Cleveland posted the biggest improvement in buyer power since 2019, with median earners now able to afford half of the city’s listings.
- Richmond, Indianapolis, Phoenix, Tampa, and Austin also registered modest gains, though affordability remains below pre-pandemic levels.
- Nationally, higher mortgage rates erased most of the benefit from wage growth, leaving the typical household able to afford $30,000 less home than in 2019.
- Milwaukee, Houston, Baltimore, New York, and Kansas City experienced the steepest declines in buyer power, underscoring widening affordability gaps.
A Few Markets Buck the Trend
Six metros managed to improve buyer power compared to 2019, per Globe St. Cleveland led the way with a 4.4% increase, adding $11,000 to the price of homes within reach of the average household. Median earners can now afford half of the city’s listings.
Phoenix, Tampa, Austin, Richmond, and Indianapolis also showed small gains. Yet, buyers in these markets still face less affordability than they did six years ago.
The National Picture: Higher Incomes, Lower Buying Power
Median household income has grown 15.7% since 2019, but affordability fell. In 2019, a typical household could finance a $320,000 loan to buy a $325,000 home. Today, that number has dropped to $298,000, even as the typical listing price climbed to $439,450.
Mortgage rates averaged 6.75% in July. Monthly payments are $600 higher than in 2019, which adds $7,200 in annual costs. Only 28% of homes on the market are affordable to the median-income buyer, compared to much higher levels in 2019.
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Where Affordability Fell the Most
Milwaukee saw the sharpest decline. Buying power dropped 10.5%, with the affordable price threshold falling by $33,000 to $281,000. Only about a quarter of listings remain within reach of median-income families.
Houston, Baltimore, New York, and Kansas City also lost ground. Each posted affordability drops of around 9%. In New York, only 13.1% of homes are considered affordable, one of the lowest shares in the country.
Why It Matters
These affordability shifts are changing buyer and seller behavior. Many households now compete for fewer attainable homes, turn to rentals, or delay homeownership. Sellers often face longer listing times or must cut prices to attract buyers.
Realtor.com’s report argues that restoring buyer power will require three things: lower mortgage rates, continued wage growth, and more housing supply—especially in affordable segments. Until then, buyers are expected to remain cautious and flexible in their search.
