The median American home costs $416,900 as of 2025, representing a price-to-income ratio of approximately 7.6 years—more than double the 3.49 ratio recorded in 1984. This dramatic shift reflects the significant rise in house prices relative to wage growth over the past several decades, with median household income standing at $83,150.
For the past two decades, rents and house prices have been rising faster than incomes across most regions of the United States. The chart below illustrates this growing disparity, with median house prices now approaching six times the median household income in America—a stark departure from historical norms.
In 1984, the median annual income for an American household stood at $22,420, and the median house sales price came in at $78,200—a ratio of 3.49. Today, that ratio has more than doubled, fundamentally altering the calculus of homeownership for millions of Americans.
Mortgage rates have traversed a remarkable range over the past half-century. The year 1981 saw rates peak at 16.64%, while 2021 recorded the historic low of 2.96%. The current 30-year fixed-rate mortgage averages 6.22%, reflecting the Federal Reserve's aggressive campaign to combat inflation.
In the 50 largest U.S. cities, median home prices are up 5.8% through November, compared with all of 2023. Anaheim, California, saw the most growth, with home prices up 12.5%.
Across the top 50 metro areas in the U.S., renting a home is cheaper than paying a mortgage right now, according to Bankrate's 2025 Rent vs. Buy Study.
| Decade | Median Home Price | Median Income | Price-to-Income Ratio | Avg Mortgage Rate |
|---|---|---|---|---|
| 1970s | $26,650 | $7,134 | 3.7x | 8.9% |
| 1980s | $149,075 | $22,000 | 6.0x | 12.7% |
| 1990s | $170,000 | $38,885 | 4.4x | 7.8% |
| 2000s | $240,000 | $51,120 | 4.7x | 6.3% |
| 2010s | $295,300 | $59,035 | 5.0x | 4.2% |
| 2020s (2024) | $416,900 | $83,150 | 7.6x | 6.7% |
Across the board, today's incomes are 3.2x higher than in 1985, but home prices are 5.6x higher. Nationally, median single-family home prices rose by nearly one-half (48 percent) between 2019 and 2024, at more than twice the rate of median income, which rose by 22 percent.
As price-to-income ratios continued to climb, 39 markets had ratios above 5.0 last year, up from just 15 markets in 2019. And in seven higher-cost markets home prices were at least eight times the median income.
In 2025, the share of first-time home buyers plummeted to a record low of 21%, while the typical age of first-time buyers climbed to an all-time high of 40 years. The median age of a first-time home buyer was 28 years old in 1991. That jumped to 38 years old in 2024.
Americans need to make about $141,000 to afford a median-priced home, but the average salary for a person in the U.S. is about half of that.