Housing Affordability Crisis Worsens as Prices Soar 55% Above What Average Incomes Can Afford

U.S. home prices have risen 55% higher than what average incomes can afford, according to one analysis.

Mortgage rates have jumped from 3% to over 7% in 2022, while a lack of housing inventory continues to prop up prices.

Incomes would need to jump 55%, prices fall 35%, or rates drop 4% to reach affordability again, per a mortgage executive.

Buyers are spending up to 60% of income on mortgage payments as costs keep climbing.

New listings are still historically low, though increased slightly in August, indicating no major inventory relief yet.