Middle-income buyers can afford to buy less than a quarter of listings in the current market, down from half just five years ago, according to the National Association of Realtors. That means that the U.S. housing market needs more than 300,000 “affordable” homes to meet middle-income demand.
“Affordable” homes, per the report, are deemed to have a value up to $256,000.
“Middle-income buyers face the largest shortage of homes among all income groups, making it even harder for them to build wealth through homeownership,” said Nadia Evangelou, NAR senior economist and director of real estate research. “A two-fold approach is needed to help with both low affordability and limited housing supply. It’s not just about increasing supply. We must boost the number of homes at the price range that most people can afford to buy.”
Among the 100 largest metro areas, El Paso, Texas; Boise, Idaho; and Spokane, Wash. have the fewest affordable homes available for middle-income buyers. Three Ohio cities–Youngstown, Akron and Toledo–have the most affordable homes available for that income group.
“Even with the current level of listings, the housing affordability and shortage issues wouldn’t be so severe if there were enough homes for all price ranges,” Evangelou added. “Our country needs to add at least two affordable homes for middle-income buyers for every home listed for upper-income buyers.”