Housing Affordability Is Improving: More Major U.S. Metros Expected to Be Affordable by Year’s End

Housing affordability has been one of the biggest challenges facing homebuyers over the past two years. In October 2023, just seven of the 50 largest U.S. metro areas were considered affordable for the average American household. At that time, the typical monthly mortgage payment consumed 38.2% of the median wage, marking one of the most stretched affordability environments on record.

But conditions are shifting — and the outlook is improving.

According to a new housing market analysis, more metro areas are projected to be affordable by the end of this year than at any point since 2022. The number of major metros considered affordable is expected to rise from just seven to approximately 20 cities nationwide.

That’s a meaningful shift in the housing market landscape.

Which Cities Are Becoming More Affordable?

By year’s end, affordability gains are expected in cities such as:

• Chicago

• Raleigh

• Atlanta

• Houston

• Minneapolis

• Baltimore

• St. Louis

• Pittsburgh

• Detroit

These markets are projected to see improved mortgage payment-to-income ratios, making homeownership more realistic for middle-income households.

While affordability is still not “easy,” the direction of the trend matters. For buyers who have been waiting on the sidelines, this may represent a turning point.

Why Is Housing Affordability Improving?

Several key factors are driving the expected gains in affordable housing markets:

1. Lower and More Stable Mortgage Rates

Mortgage rates remain one of the largest influences on monthly housing costs. Forecasts suggest rates will be lower and less volatile this year, helping improve purchasing power.

Even a modest drop in mortgage rates can significantly reduce a borrower’s monthly payment and increase loan qualification limits. For buyers, this directly impacts debt-to-income ratios and overall affordability.

2. Slower Home Price Growth

After years of rapid appreciation, home price increases are expected to slow in 2026. Slower price growth doesn’t mean declining values — it means more balance between buyers and sellers.

When prices stabilize, buyers are better able to plan, budget, and compete without the pressure of double-digit appreciation.

3. Expected Wage Growth

As wages continue to rise, the gap between income and housing costs narrows. Improved income levels combined with calmer mortgage rates create better payment-to-income ratios — the core measurement of housing affordability.

What This Means for Buyers in New Jersey, Pennsylvania & Florida

While national data shows improving affordability in several major metros, real estate is always local.

In markets across New Jersey first, followed by Pennsylvania and Florida, affordability trends vary by county and neighborhood. Inventory levels, migration patterns, and job growth all influence local pricing.

For example:

• Parts of South Jersey may benefit from steady demand but controlled inventory growth.

• Pennsylvania markets often provide more price stability compared to high-volatility coastal regions.

• Florida affordability varies significantly depending on metro size and migration activity.

The key takeaway: Affordability is gradually improving nationwide, but your local market may respond differently.

Is This the Right Time to Buy?

If affordability continues trending in the right direction, buyers who act early may benefit from:

• Reduced competition compared to peak pandemic years

• Improved mortgage qualification power

• Slower home price increases

• More predictable rate movement

Waiting for “perfect” conditions can sometimes mean missing opportunity. As rates stabilize and prices grow at a slower pace, incremental improvements in affordability can make a meaningful difference in long-term homeownership costs.

The Bottom Line on 2026 Housing Affordability

The housing market is not returning to ultra-low 2020 levels — but it is becoming more balanced.

From just seven affordable major metros in late 2023 to a projected 20 by year’s end, the trajectory is encouraging. Lower mortgage rates, slower home price growth, and steady wage gains are combining to improve monthly mortgage affordability across a growing number of U.S. cities.

If you’re considering buying a home in New Jersey, Pennsylvania, or Florida, understanding how national trends connect to your local housing market is critical.

Affordability is improving — and positioning yourself correctly now could make all the difference.