Homebuyer affordability conditions deteriorated in June, marking the fifth straight month of decline, according to data from the National Association of Realtors’ housing affordability index. Based on a median single-family home price of $446,400 and an average 30-year fixed mortgage rate of 6.57%, prospective buyers needed an annual income of $109,152 to qualify for a mortgage, assuming a 20% down payment.
The affordability slide has persisted since January, when the median price stood at $398,200, rates averaged 6.19%, and required income was $93,552. However, year-over-year comparisons present a more mixed picture. Lawrence Yun, chief economist for NAR, noted that compared with June 2025, affordability actually showed slight improvement, as wage growth outpaced home price increases and mortgage rates were marginally lower. In June 2025, rates were 6.9% and $110,928 in income was required to qualify.
Mortgage rates had dipped below 6% in late February before rising following geopolitical developments and inflation concerns. The consumer price index showed annual inflation at 3.5%, matching average hourly wage growth, meaning that income gains are being largely offset by rising costs. Experts also note that home prices typically increase from winter through mid-summer as buyer activity rises.
While median existing home prices reached an all-time high of $440,600 in June, the pace of price increases has slowed considerably. June’s median was 1.8% higher than a year earlier, significantly below the double-digit annual increases recorded during the pandemic housing boom. Regional variations remain substantial, with the Midwest and South generally more affordable than the Northeast and West.
On July 11, the bipartisan 21st Century ROAD to Housing Act became law, incorporating measures designed to boost housing supply and improve affordability through incentives for construction, expanded financing access, and restrictions on institutional investor purchases. Economists caution that benefits may take considerable time to materialize, as the nation faces a shortage of more than 4 million homes that will require sustained effort to address.
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