The American Dream now costs $3,455,305—that's the estimated lifetime cost of common milestones including marriage, two children, homes, healthcare, cars, and education

The American Dream now costs $3,455,305—that's the estimated lifetime cost of common milestones including marriage, two children, homes, healthcare, cars, and education, per Investopedia.

A recent report from the National Association of Realtors and Realtor.com highlights the alarming state of the US housing market, where more than 75% of homes available are beyond the reach of middle-class buyers. The primary cause of this affordability crisis is the scarcity of housing supply, which has significantly impacted middle-income buyers. Elevated mortgage rates have exacerbated the problem, resulting in a shortage of around 320,000 homes priced at or below $256,000 – the maximum affordable price for a middle-income buyer earning up to $75,000.

In April, out of the 1.1 million listings on the market, middle-income buyers could only afford approximately 23% of them. This is a substantial decline compared to five years ago when around 50% of all listings were considered affordable for this group.

The report identifies Ohio as the state with the three metropolitan areas having the largest inventory of affordable homes. Conversely, El Paso, Texas; Boise, Idaho; and Spokane, Washington have the fewest number of affordable listings.

NAR senior economist Nadia Evangelou emphasized that the housing affordability and shortage issues wouldn't be so severe if there were enough homes available at various price ranges. She suggested that the country needs to add at least two affordable homes for middle-income buyers for every home listed for upper-income buyers.

The US housing market has experienced a slowdown in 2023 due to high mortgage rates, which have discouraged both buyers and sellers. Existing homeowners are reluctant to list their properties for sale as many of them financed their homes during the period of ultra-low interest rates in the last decade.

This inventory shortage is projected to persist for several years, leading to a continuous rise in home prices and exacerbating the problem of unaffordability. According to data from the Mortgage Bankers Association, housing has never been so unaffordable for Americans, with the group's Purchase Applications Payment Index reaching a record high of 172.3 in April.