Americans still need to earn nearly $110,000 a year to comfortably afford the typical home for sale in the United States, even as housing affordability has shown modest signs of improvement over the past year.
A new Redfin report found that a household would need an annual income of $109,796 to purchase the median-priced U.S. home in June 2026 while spending no more than 30% of said income on housing costs. That's just 0.5% lower than the record high of $110,382 a year ago, meaning the income needed to buy a home has changed very little over the past year.
The stabilization comes as household incomes have continued to rise alongside home prices. Redfin estimates the median U.S. household earned $87,599 in June, up 4% from a year ago, while the median home sale
price increased 2.2%. Mortgage rates also eased slightly but remained in the mid-6% range, keeping borrowing costs elevated.
Even with those gains, according to Redfin, the typical household still earns about $22,200 less than what's needed to purchase the median-priced home and be financially comfortable. That's an improvement from the roughly $26,100 gap a year ago, and nearly $28,900 two years ago, but it remains a significant hurdle for many prospective buyers.
Here's more on Redfin's recent report.
Affordability remains a challenge
Redfin defines a home as affordable when a buyer with a 15% down payment spends no more than 30% of their monthly income on mortgage payments, property taxes and other housing costs.
"The earnings needed to buy a house have stabilized after several years of deterioration, but that doesn't mean homes are affordable to the average American," Redfin Senior Economist Yingqi Xu said in the report.
Xu said the market has become "a bit more manageable" for buyers because it is now a "buyer's market" in much of the country, giving shoppers more options and stronger negotiating power. Even so, she said many prospective first-time buyers remain on the sidelines because the typical household still earns far less than what's needed to afford a home and be financially comfortable.
Redfin economists said affordability could improve slightly by the end of the year; however, the real estate company warned it could also worsen if interest rates rise more than expected, oil prices increase further or inflation accelerates.
More listings are within reach
The report found buyers are spending a smaller share of their income on housing than a year ago. The typical homebuyer would need to spend 37.6% of their income on a median-priced home, down from 39.3% last year. Redfin said the decline comes as median household income increased from $84,257 to $87,599, while the income needed to afford a home remained largely unchanged.
Meanwhile, 34.2% of homes for sale were affordable for households earning the national median income in June, up from 30.5% a year earlier. Even so, Redfin noted affordability remains well below pre-2022 levels, when more than half of listings were typically within reach of the median-income household.
Where affordability is improving
Affordability improved in 24 of the 46 major metro areas Redfin analyzed. Seattle saw the largest improvement, with the income needed to afford the typical home falling 7.4% from a year ago as home prices declined. San Jose and Portland also saw some of the biggest drops, with the income needed to afford a home falling 6.5% and 4.5%, respectively.
Despite those improvements, homes in many West Coast markets remain out of reach for average earners. San Francisco remained the nation's least affordable major metro, where buyers would need an annual income of $453,205 to afford the typical home.
Only three major metro areas, St. Louis, Indianapolis and Pittsburgh, had median household incomes that exceeded the income required to afford the typical local home, according to Redfin.
Reporter Anthony Thompson can be reached at ajthompson@usatodayco.com or on X @athompsonUSAT
This article originally appeared on USA TODAY: This is the salary needed to afford a typical US home in 2026
