H
omeownership remains a cornerstone of the American dream, but a severe shortage of affordable homes is blocking this pathway for many middle-income families. According to a recent analysis from the National Association of Realtors (NAR), only about 1 in 5 listed homes in March were affordable for households with $75,000 in annual income, down from nearly half of all listings before the pandemic. To return to pre-pandemic levels, the US would need over 400,000 new listings priced at $255,000 or below.

    The median sale price in the first quarter of 2025 was almost $420,000, exacerbating the affordability gap for middle-class households. Nadia Evangelou, senior economist and director of real estate research at NAR, attributes this issue to the housing crisis that began in 2006, which led to a years-long drought in new construction.

    The lack of affordable homes drives up prices as would-be buyers bid up home prices to secure a property, further limiting middle-income families' access to the market. Evangelou notes that these households, including those in careers like nursing and teaching, are essential to the housing market's backbone.

    Twenty-six of the biggest 100 cities have worsening affordability gaps, often due to zoning or permitting restrictions hindering new construction. Cities with severe affordability issues range from high-cost areas like Los Angeles to more affordable regions like Harrisburg-Carlisle and Scranton in Pennsylvania.

    In contrast, thirty cities are showing improvements in affordable listings, including Raleigh-Cary, North Carolina, and Columbia, South Carolina. These areas have seen a 5% increase in affordable listings over the past year, partly due to increased construction of properties like townhomes.

    To alleviate the affordability crunch, Evangelou suggests easing zoning regulations, bolstering downpayment assistance programs, and exploring innovative housing solutions like micro-apartments.