Most US markets stayed historically unaffordable even as Q4 brought a small break
US homebuyers ended 2025 facing some of the worst affordability conditions on record, despite a modest late‑year reprieve in borrowing costs and price pressures.
Homes in 99% of the 594 counties analyzed by ATTOM were less affordable than their long‑term norms in the fourth quarter, as the national median price hovered around $365,185.
Over the past five years, the median sales price rose 54% while typical wages climbed just 29%, according to ATTOM’s new US Home Affordability Report, which drew on Bureau of Labor Statistics data.
“Many Americans were priced out of buying a home in 2025, and affordability remains worse than historic norms in most markets,” said Rob Barber, CEO of ATTOM.
“Still, modest, quarter‑over‑quarter affordability improvements in many markets at the end of the year offered some encouragement.”
In 86% of counties, homes were more affordable in the fourth quarter than in the third, helped by mortgage rates that slipped from roughly 6.34% in early October to 6.15% by year‑end.
However, in 74.1% of markets, major ownership costs on a median‑priced home still consumed more than 28% of the typical wage, breaching the traditional affordability threshold.
California remained the epicenter of strain, with Marin, Santa Cruz, Orange and Monterey counties among the least affordable, and Kings County, New York, topping the list, where ATTOM estimated a buyer would have needed more than a full year’s typical wages to carry a median‑priced home.
Nationwide, a buyer would have had to earn about $86,374 in 2025’s fourth quarter to afford the median‑priced home under a standard 28% front‑end ratio, compared with an average wage of $77,038.
Beyond ATTOM’s report, industry economists have been tracking a slow pivot. First American’s Mark Fleming previously said that household income is expected to rise faster than house prices in 2026, arguing that “mortgage rates may drift down only slowly, but income growth exceeding house price appreciation will provide a boost to house‑buying power.”
Fannie Mae has projected the 30‑year fixed rate would average about 6.2% in early 2026 before dipping below 6% by year‑end.
ATTOM’s affordability index, built from recorded sale deeds, BLS wage data and Freddie Mac’s 30‑year fixed rate series, underscores how far the market still stands from pre‑pandemic norms, even as late‑2025 data pointed to what some analysts viewed as the first tentative shift back toward buyers.
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