The rising cost of housing is straining family budgets, with the average household now spending 38% of their income on mortgage payments for a median-priced home. This figure highlights the affordability challenges across the U.S., with stark contrasts between the most and least burdensome housing markets.

Housing Affordability Hits Hard

According to the National Association of Home Builders/Wells Fargo Cost of Housing Index (CHI), a family earning the median national income of $97,800 would need to spend 38% of their income on a median-priced new home in Q3. For low-income families earning half that amount, the burden rises to 75%, reflecting severe affordability challenges.

Although these figures have dipped slightly since Q2, the financial strain remains significant for many families, especially in high-cost regions.

Most Expensive Housing Markets

Housing costs are particularly challenging in regions known for sunny climates and urban attractions. These areas dominate the CHI’s list of the most cost-burdened markets:

1. San Jose-Sunnyvale-Santa Clara, CA
   • Families need 85% of their income to afford a home.
   • Median home listing price: $1.79 million.
2. Honolulu, HI
   • Requires 75% of a typical family’s income.
   • Median listing price: $618,500.
3. San Diego-Chula Vista-Carlsbad, CA
   • Families spend 70% of their income.
   • Median listing price: $946,500.
4. San Francisco-Oakland-Berkeley, CA
   • Families allocate 68% of income for housing.
   • Median listing price: $1.2 million.
5. Miami-Fort Lauderdale-Pompano Beach, FL
   • Families need 63% of their income.
   • Median listing price: $650,000.

In these areas, low-income families face even greater challenges, with housing costs exceeding 127% of their income in some cases.

The Midwest Offers Relief

In contrast, the Midwest boasts several affordable housing markets, where families spend significantly less of their income on housing:

1. Decatur, IL
   • Housing costs: 16% of income.
   • Median home price: $134,170.
2. Cumberland, MD-WV
   • Housing costs: 18% of income.
   • Median home price: $144,900.
3. Springfield, IL
   • Housing costs: 18% of income.
   • Median home price: $169,000.
4. Elmira, NY
   • Housing costs: 19% of income.
   • Median home price: $115,000.
5. Peoria, IL
   • Housing costs: 19% of income.
   • Median home price: $129,630.

Even for low-income families, these markets remain relatively accessible, requiring between 33% and 39% of income for housing.

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