The U.S. housing market presents severe affordability challenges for average Americans. Home prices have skyrocketed over the past decade—like one home jumping from $192K to $683K without improvements—while wages lag far behind. J.P. Morgan forecasts just 3% price growth in 2025, but that offers little relief when prices already sit near historic highs. Inventory remains critically low, roughly 20-30% below pre-pandemic levels, creating intense competition even for modest homes.

Median home prices hover around $369,147 nationally, with recent quarterly data showing $416,900. This represents a massive disconnect from median household incomes. In many markets, especially coastal and urban areas, prices have doubled or tripled since 2011 while salaries increased only marginally.

Current interest rates remain “higher-for-longer,” as J.P. Morgan notes. With 30-year fixed mortgages near 7%, monthly payments on a median-priced home now consume over 40% of the average paycheck—well above the 30% threshold for affordability. First-time buyers, particularly millennials and Gen Z, face near-impossible entry barriers.

– : New listings are scarce, and existing homeowners cling to low-rate mortgages.
– : Prices fell in 11 states like Florida (-1.2%) and Texas (-1.2%), but these dips don’t offset national unaffordability.
– : Zoning restrictions and red tape prevent sufficient new construction in high-demand areas.

For working families, homeownership increasingly requires generational wealth, relocation to depressed markets, or risky financial leveraging. Without significant wage growth, deregulation of construction, or rate cuts, the American Dream of homeownership slips further from reach.