U.S. Home Prices Have Increased 2x Faster Than Income Since 2000

With the U.S. population growing and demand outweighing availability of housing, buying a home now costs more than 5x the average American’s annual salary.

ST. LOUIS, Nov. 9, 2023 /PRNewswire/ — Home prices across the U.S. have soared 162% since 2000, while income has only increased 78%, according to new research from Home Bay, an online publication owned by Clever Real Estate that connects readers with expert real estate advice.

Home prices have increased 2x faster than income since 1985, and 2.1x faster than income since 2000. If home prices grew at the same rate as income since 2000, the median U.S. home would cost nearly $294,000 — about 32% less than today’s actual price of $433,100.

Even more, if home prices grew at the same rate as income since 1985, the median home would cost about $262,000 instead of $433,100.

To afford the median-priced home of $433,100, Americans need an annual income of roughly $166,600. But the median household earns just $74,580 — only 45% of the recommended amount.

Buying a home should cost about 2.6x what the average American makes in a year, according to financial experts. In reality, it currently costs 5.8x the median household income.

Not only is the current house-price-to-income ratio of 5.8 double the recommended ratio of 2.6, it’s 66% higher than it was in 1985 and 49% higher than it was in 2000.

Although none of the 50 most-populous metros in the U.S. have a home-price-to-income ratio below or equal to the 2.6 range that financial experts recommend, the 10 most affordable are:

  1. Pittsburgh, Pennsylvania (3.2)
  2. Buffalo, New York (3.5)
  3. Cleveland, Ohio (3.5)
  4. St. Louis, Missouri (3.6)
  5. Detroit, Michigan (3.7)
  6. Oklahoma City, Oklahoma (3.7)
  7. Louisville, Kentucky (3.9)
  8. Cincinnati, Ohio (3.9)
  9. Indianapolis, Indiana (4.1)
  10. Hartford, Connecticut (4.2)

Overall, the 10 most-affordable cities have an average home-price-to-income ratio of 3.7, which is 36% lower than the national average

Meanwhile, the 10 least affordable metro areas for housing are:

  1. San Jose, California (12.1)
  2. San Francisco, California (10.4)
  3. San Diego, California (9.5)
  4. Los Angeles, California (9.0)
  5. Miami, Florida (8.6)
  6. Seattle, Washington (7.4)
  7. Boston, Massachusetts (7.0)
  8. New York, New York (6.9)
  9. Riverside, California (6.9)
  10. Denver, Colorado (6.8)

However, there are still signs of hope for aspiring home buyers — in the past 12 months, the house-price-to-income ratio has actually decreased in all 10 of the most expensive cities.

Read the full report at: https://homebay.com/income-to-house-price-ratio-2023/

About Home Bay
Home Bay is a web-property of Clever Real Estate, an online platform that connects home buyers and sellers with top-rated agents at a discount rate.

Please contact Alyssa Evans at
with any questions or for an interview.

Alyssa Evans
PR Strategist
Clever Real Estate