A new Redfin report says Americans need to earn nearly $110,000 a year to comfortably afford a typical home—about $22,000 more than the median household income. That gap is keeping many first-time buyers on the sidelines, even as affordability slowly improves.
Here are the key takeaways from the report:
- **The income needed is down slightly from last year.** To afford the median-priced U.S. home in June, buyers needed an annual income of **$109,796**, just below 2025’s record of $110,382.
- **But it’s still out of reach for many.** The typical U.S. household earns $87,599. That means they would need to spend about **38% of their income** on housing, well above the recommended 30% threshold.
- **First-time buyers are getting some relief.** The income needed to afford a typical starter home fell to **$70,693**, down 1.5% year-over-year and marking eight straight months of improvement.
- **Affordability varies widely by location.** In only three major metro areas—**St. Louis, Indianapolis, and Pittsburgh**—does the median household earn enough to afford a home. Detroit, Baltimore, and Cleveland also rank among the most affordable markets.
- **There’s optimism for the rest of 2026.** Redfin is calling this year “the great housing reset,” predicting affordability could keep improving as the market shifts in buyers’ favor, especially in former pandemic hotspots like Nashville and Austin.
In short: things are getting a little better, but for most Americans, buying a home remains a financial stretch.