Even as inventory rises nationwide, millions of buyers can’t find a home they can afford.
A new joint report from Realtor.com® and the National Association of Realtors® reveals a grim reality for the middle class: despite a 20% year-over-year increase in for-sale inventory, that inventory isn’t within grasp.
The homes that are hitting the market aren’t matching what most buyers can afford, especially for those earning around $75,000 a year, which is close to the national median income.
Read on for a quick breakdown.
A Housing Market Out of Balance
The current market is falling far short of what economists consider “balanced” for middle-income buyers.
In March 2025, homebuyers earning $75,000 annually could afford just 21% of all listings nationwide, down from 49% in 2019. In a balanced market, that same income group should be able to afford 48% of available homes.
To close that gap, the market would need 416,000 additional homes priced below $260,000.
Realtor.com Chief Economist Danielle Hale puts it this way:
“Shoppers see more homes for sale today than one year ago, and encouragingly, many of these homes have been added at moderate income price points.
“But as this report shows, we still don’t have an abundance of homes that are affordable to low- and moderate-income households, and the progress that we’ve seen is not happening everywhere.”
The mismatch between income and inventory is so severe that out of the nation’s 100 largest metro areas, only two—Akron and Youngstown, Ohio—have sufficient inventory to meet demand from this income group.
It’s Not Just Middle-Income Buyers Struggling
Households earning more or less than $75,000 a year aren’t faring much better.
Households earning $100,000/year:
- Can currently afford 37% of homes for sale
- Down from 65% in 2019
- Well below the 61% affordability target
- Would require 364,000 additional listings priced below $340,000 to reach balance
Households earning $50,000/year:
- Can afford just 8.7% of listings
- Down from 9.4% one year ago
- In a balanced market, they should be able to afford 33% of listings
- Would require 367,000 homes priced below $170,000 to meet demand
Nadia Evangelou, senior economist for NAR, sums it up:
“For many first-time home buyers, navigating the current housing market still feels like window shopping. Listing prices don’t match first-time home buyers’ budgets. If the promising trend of building smaller homes continues, that could be a meaningful step toward easing the housing affordability gap for more buyers.”
Where Are Conditions Improving?
While the national picture shows a widening affordability gap, a few states are bucking the trend, and even making meaningful progress.
According to the report’s state-level analysis, housing affordability varies drastically depending on location. Using an “affordability distribution score” for each state, researchers identified regions that are closest to a balanced market, those with the most severe shortfalls, and those showing the biggest improvements in 2025.
States Closest to a Balanced Market:
Five states stand out for maintaining relatively balanced conditions for middle-income buyers earning around $75,000 per year:
- Iowa
- Ohio
- Indiana
- Illinois
- West Virginia
In each of these states, a $75K income can cover the cost of at least 45% of available homes. In Iowa, for example, 48% of listings fall within that income range, right on par with the 48% affordability benchmark used to define a balanced market.
This suggests a healthier match between incomes and home prices. And it offers a major advantage for agents working in these areas. Buyers here are more likely to find listings within their budget, which can shorten the sales cycle and build confidence in local markets.
States With the Most Significant Improvements in 2025
While affordability remains a challenge nationwide, some states have made notable year-over-year gains in 2025 by expanding inventory at key price points:
- Delaware
- Utah
- Colorado
- Florida
- Arizona
These markets succeeded in adding homes priced for moderate-income households, which led to measurable improvements in affordability scores.
For example:
- Florida added nearly 13,000 listings priced under $260,000 in the past year.
- Arizona and Colorado each added approximately 1,300 affordable listings.
This broader inventory has helped bring more homes within reach for middle-class buyers, especially in areas previously plagued by high prices and low supply.
States With the Largest Shortfall of Affordable Listings:
At the other end of the spectrum are five states where housing affordability remains out of reach for most buyers:
- Montana
- Idaho
- California
- Massachusetts
- Hawaii
Despite a general increase in inventory, these states continue to report the largest affordability gaps in the country. In most of them, buyers earning $75,000 can afford fewer than 10% of active listings. And in places like California and Massachusetts, that figure drops below 5%.
Even higher earners are struggling: in these markets, households making $150,000 a year still can’t afford more than 30% of available homes.
These numbers underscore just how far out of reach homeownership has become in high-cost coastal and Western states, and how urgently local policy solutions are needed.
The District of Columbia: A Rare Pre-Pandemic Comeback
In a surprising twist, only one area in the country has improved affordability compared to pre-pandemic levels: the District of Columbia.
From 2019 to 2025, D.C.’s affordability score improved from 0.64 to 0.70, indicating a stronger alignment between buyer incomes and home prices. For middle-income buyers, the affordability gap narrowed from 32 percentage points in 2019 to 27 percentage points in 2025.
What This Means for Agents
The biggest message from this report? Inventory isn’t enough. Buyers need affordable inventory—and that’s still in short supply, as Ivy Zelman pointed out in a recent HousingWire panel.
With that in mind, here are a few key takeaways for agents:
- Know your local market deeply. States like Ohio and Iowa are offering better opportunities for middle-income buyers. If you’re in one of these areas, lean into that advantage in your marketing.
- Guide clients with realistic expectations. Help buyers understand the price thresholds tied to their income and be upfront about what they can expect.
- Advocate for smaller homes and affordable new construction. As Evangelou noted, building more entry-level homes could be key to restoring balance.
- Keep track of affordability trends. As inventory changes, so will opportunities—and pain points—for buyers. Stay ahead of the curve to better serve your clients.
The affordability crisis isn’t going away overnight. But armed with the right data and insights, you can help your clients navigate it.
