In the May edition of its U.S. home price insights report, market analytics firm Cotality observed a national housing market “caught in a crosscurrent of pent-up demand and an affordability crisis.”
Drilling down into the affordability side of the equation, the company’s chief economist, Selma Hepp, said a “split in opportunity” is occurring, with high mortgage rates exacerbating homeownership barriers for prospective first-time buyers.
“Market activity is increasingly limited to those with enough equity or cash to ignore mortgage rates, which only widens the gap for those trying to get their foot in the door,” Hepp remarked.
A recent study by Best Interest Financial, an affiliate of Clever Real Estate, found that since 1980, U.S. home prices have grown by 551% while household incomes have risen just 373%.
Taking those systemic shifts a step further, Best Interest noted that if incomes had kept pace with home prices, the median household would earn $115,224 today instead of the actual median of $83,730 reported in 2024.
According to Cotality, the median income required to afford a median-priced home reached $91,000 in March, putting homeownership out of reach for a wide swath of the U.S. population.
The Best Interest analysis noted that the recommended maximum home-price-to-income ratio is 2.6, but the national average ratio is 5.08. Furthermore, zero of the 50 most populous U.S. metros meet that affordability standard. Pittsburgh comes closest, with a 3.07 ratio, but 20 metros have ratios more than double the recommended threshold.
To overcome those homeownership hurdles, 40% of respondents to LendingTree’s 2026 mortgage downpayment survey said they received financial help to purchase their current home, up from 35% in 2023.
The survey results reveal stark generational divides. Gen Z members between the ages of 18 and 29 received downpayment assistance at a 78% clip, compared to 56% for millennials (ages 30 to 45), 35% for Gen X (ages 46 to 61) and just 12% for baby boomers (ages 62 to 80).
Still, homeownership remains a life priority for younger generations, according to a separate survey from Clever.
If given a mulligan, 43% of undergraduates polled by Clever said they would prioritize buying a home over attending college. Asked why members of their generation are struggling to afford homes, 67% cited the high cost of living, 49% identified housing prices rising faster than wages and 40% put the blame on student loan debt.
But the poll also highlighted indefatigable optimism among Gen Z undergrads. Eighty-four percent of college-age respondents said they expect to own a home before they turn 40, while 41% think they’ll add house keys to their key ring before age 30.
Those numbers may be inflated by unrealistic earnings expectations, however. Clever found the average college student expects to make around $80,000 one year after graduation — even though the average starting salary is just $56,153.
