Though middle-income earners can afford to buy a home, supply is very tight
The National Association of Realtors and Realtor.com issue a report saying lack of housing supply remains a significant problem
Housing affordability and supply have been ongoing challenges for many Americans as they look to buy homes.
A newly released report from the National Association of Realtors (NAR) and Realtor.com found that nationwide inventory has gone up compared to last year as of March, but “access to affordable homes remains out of reach for many buyers.”
Among the income levels that the report looked at, middle-income buyers with $75,000 in annual pay saw the biggest year-over-year increase in the share of homes listed on the market that they are financially able to purchase, with it going from 20.8% in March 2024 to 21.2% this year.
A “For Sale” sign hangs in front of a house in Patchogue, New York, on June 1, 2024. (Steve Pfost/Newsday RM via Getty Images / Getty Images)
At the same time, that remains 27.6 percentage points lower than the share in pre-pandemic 2019 and 26.9 percentage points short of what they should be capable of buying in a balanced market, according to the NAR and Realtor.com’s “Housing Affordability & Supply” report.
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Middle-income buyers have an “affordability gap” of more than 415,900 homes priced below $254,780, the report said.
“This income group, middle-income buyers, face the largest shortage of affordable listings,” NAR Senior Economist and Director of Real Estate Research Nadia Evangelou told FOX Business in an interview. “So middle-income buyers gained the most, and that’s very encouraging, yet still have the furthest to go, so there is this middle-income paradox, like biggest gains and biggest gaps.”
Upper-middle-income buyers also saw the share of homes up for sale that they can afford go up from March 2024 — rising 0.2 percentage points to hit 37.1% — but like middle-income earners, there is still a big deficit of affordable homes for them.
According to the report, a balanced market should have 742,870 homes with prices manageable for them, meaning nearly 363,700 homes sporting price tags of $339,700 or lower are necessary.
As for low-income buyers, Evangelou said there has been “no improvement” in the share of listings on the market that income group can afford.
In January, a survey released by Realtor.com found many U.S. adults — 75% — still consider homeownership to be a component of the American Dream. (iStock / iStock)
Households with annual incomes of $50,000, $35,000, $25,000 and less than $15,000 all contended with the share of listings they can bear the expense of shrinking between March 2024 and March of this year, the report showed.
For example, the proportion of up-for-sale homes accessible to homebuyers who make $50,000 decreased 0.7 percentage points year-over-year, hitting just 8.7%.
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The report said $50,000 income earners…
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