A homebuyer needed to earn an annual income of at least $116,782 to afford a home at the end of 2024

A household earning the 2024 U.S. median income of $83,782 would need to allocate 41.8% of their earnings toward monthly housing costs to afford the median-priced home, valued at $429,734, according to a new report from Redfin (redfin.com), a technology-driven real estate brokerage. While this represents a slight improvement from 42.2% in 2023, it remains significantly above the 30% affordability threshold that was typical throughout the 2010s.

Wages Outpace Housing Costs Slightly

“Affordability improved ever so slightly this year because wage growth outpaced the growth in monthly housing payments,” said Redfin Senior Economist Elijah de la Campa. “But that’s not to say buying a home became affordable. For many Americans, buying a home remains more out of reach than ever, and that’s unlikely to change anytime soon. Even with inventory trending upwards, we still expect prices to continue rising in 2025 due to a lack of homes for sale—pushing more would-be homebuyers to rent instead.”

Record Income Requirements

To keep housing payments at 30% of income in 2024, a homebuyer would need to earn at least $116,782 annually—a record high and $33,000 more than the median household income. The median monthly housing payment for homebuyers reached a record $2,920 in 2024, marking a 4.3% increase from 2023 and an 86% surge since 2019. Although wages grew around 4% year-over-year in 2024, affordability improved slightly due to a marginally lower average mortgage rate of 6.72%, compared to 6.81% in 2023. However, 2024 marked the fourth consecutive year where the required income to afford a median-priced home exceeded the median household income.

Texas Metros Lead Affordability Gains

Among the 50 most populous U.S. metropolitan areas, Texas cities led the way in improved housing affordability. In Austin, a household earning the 2024 median income of $103,717 would need to spend 39.6% of their earnings on monthly housing costs for a $444,928 median-priced home, down from 42.8% in 2023. This 3.2 percentage-point drop was the largest improvement in affordability nationwide.

The next metros showing the most significant gains were:

• San Antonio: 35.4% of income (-2.3 percentage points)
• Dallas: 38.9% of income (-2 points)
• Fort Worth: 36.7% of income (-1.6 points)
• Portland, OR: 45% of income (-1.4 points)

Texas has seen a surge in housing construction, particularly during the pandemic, as remote workers moved to more affordable Sun Belt cities. Increased inventory and reduced demand have led to price declines, driving improvements in affordability.

Anaheim, Chicago, and Miami See Declines

On the flip side, Anaheim, CA, experienced the sharpest decline in affordability. In 2024, a household earning the median income of $121,925 would need to spend 75.9% of their earnings on a $1,165,965 median-priced home, up from 71.8% in 2023. This 4.1 percentage-point increase was the largest among major metros.

Other cities with worsening affordability included:

• Chicago: 34.7% of income (+2 points)
• Miami: 63.1% of income (+1.7 points)
• Newark, NJ: 48.8% of income (+1.6 points)
• San Jose, CA: 73.9% of income (+1.5 points)

These metros saw affordability worsen primarily due to rising home prices. Anaheim led the nation with a 12.4% increase in home prices, followed by Newark (11.3%), Chicago (8.6%), San Jose (8.6%), and Miami (7.9%), all outpacing the national home price increase of 4.8%.