A recent study reveals that 2024 ranked as the second least affordable year for homebuyers on record, surpassed only by 2023. Despite a marginal improvement, homeownership remains out of reach for many Americans.
By the Numbers
The analysis found that a household earning the median U.S. income of $83,782 in 2024 would have needed to allocate 41.8% of their earnings toward monthly housing costs to afford the median-priced home of $429,734.
While this marks a slight improvement from the 42.2% recorded in 2023, affordability remains significantly worse than the 30% or lower threshold that was typical throughout the 2010s.
Expert Insights
“Affordability improved slightly this year because wage growth outpaced the rise in monthly housing payments,” said Elijah de la Campa, senior economist at Redfin. “However, that doesn’t mean homeownership has become accessible. For many Americans, buying a home remains more out of reach than ever—and that’s unlikely to change anytime soon.”
He added that while inventory levels are gradually increasing, home prices are expected to keep rising in 2025 due to a persistent shortage of homes for sale. As a result, more prospective buyers may be forced to continue renting.
Texas Leads in Housing Affordability Gains
By the Numbers
Among the nation’s 50 largest metropolitan areas, Austin, Texas, saw the most significant improvement in affordability. A household earning the city’s median income of $103,717 in 2024 would have spent 39.6% of its income on monthly housing costs for a median-priced home of $444,928—down from 42.8% in 2023.
What’s Driving the Shift?
Redfin attributes Texas’ improving affordability to a surge in housing construction, particularly during the COVID-19 pandemic when remote workers flocked to Sun Belt cities in search of more affordable living options.
Following Austin, the metros that experienced the highest affordability improvements were:
- San Antonio, TX
- Dallas, TX
- Fort Worth, TX
- Portland, OR
Other cities where home affordability improved include Tampa, Houston, Orlando, San Francisco, Denver, Sacramento, and Nashville.
California Dominates List of Least Affordable Cities
By the Numbers
At the opposite end of the spectrum, Anaheim, California, ranked as the least affordable metro in the U.S. A household earning the city’s median income of $121,925 in 2024 would have needed to allocate a staggering 75.9% of its earnings toward monthly housing costs for a median-priced home of $1,165,965.
This marks a sharp increase from 71.8% in 2023—the largest affordability decline among major metros.
Other cities facing worsening affordability include:
- Chicago, IL
- Miami, FL
- Newark, NJ
- San Jose, CA
What’s Behind the Decline?
Soaring home prices were the primary driver of worsening affordability in these metros. Anaheim recorded a 12.4% jump in home prices in 2024—the highest increase among major U.S. metros—while Chicago, Miami, Newark, and San Jose all saw price gains exceeding the national average of 4.8%.
The Income Barrier: What It Takes to Buy a Home in 2024
Key Findings
The study also found that to afford a median-priced home while keeping housing costs at or below 30% of their income, a homebuyer in 2024 would need to earn at least $116,782 annually—far above the U.S. median household income.
Industry Perspective
“That’s a record high and represents an income gap of $33,000 compared to what the typical U.S. household earns in a year,” Redfin noted. While financial experts traditionally recommend keeping housing costs below 30% of income, this benchmark has become increasingly difficult to achieve as home prices continue to soar.
