LOS ANGELES (AP) — Homeownership is receding further out of reach for most Americans as elevated mortgage rates and rising prices stretch the limits of what buyers can afford.
A homebuyer now needs to earn at least $114,000 a year to afford a $431,250 home -- the national median listing price in April, according to data released Thursday by Realtor.com
The analysis assumes that a homebuyer will make a 20% down payment, finance the rest of the purchase with a 30-year fixed-rate mortgage, and that the buyer’s housing costs won't exceed 30% of their gross monthly income — an often-used barometer of housing affordability.
Based off the latest U.S. median home listing price, homebuyers need to earn $47,000 more a year to afford a home than they would have just six years ago. Back then, the median U.S. home listing price was $314,950, and the average rate on a 30-year mortgage hovered around 4.1%. This week, the rate averaged 6.76%.
The annual income required to afford a median-priced U.S. home first crossed into the six figures in May 2022 and hasn't dropped below that level since. Median household income was about $80,600 annually in 2023, according to the U.S. Census bureau.
In several metro areas, including San Francisco, Los Angeles, New York and Boston, the annual income needed to afford a median-priced home tops $200,000. In San Jose, it's more than $370,000.
Rock-bottom mortgage rates turbocharged the housing market during the pandemic, fueling bidding wars for homes that pushed up sale prices sometimes hundreds of thousands of dollars above a seller initial asking price. U.S. home prices soared more than 50% between 2019 and 2024.
The U.S. housing market has been in a sales slump since 2022, when mortgage rates began to climb from their pandemic-era lows. Sales of previously occupied U.S. homes fell last year to their lowest level in nearly 30 years. In March, they posted their largest monthly drop since November 2022.
It's not all bad news for prospective homebuyers.
Home prices are rising much more slowly than during the pandemic housing market frenzy. The national median sales price of a previously occupied U.S. home rose 2.7% in March from a year earlier to $403,700, an all-time high for March, but the smallest annual increase since August.
In April, the median price of a home listed for sale rose only 0.3% from a year earlier, according to Realtor.com.
Buyers who can afford current mortgage rates have a wider selection of properties now than a year ago.
Active listings — a tally that encompasses all homes on the market except those pending a finalized sale — surged 30.6% last month from a year earlier, according to Realtor.com. Home listings jumped between 67.6% and 70.1% in San Diego, San Jose and Washington D.C.
As properties take longer to sell, more sellers are reducing their asking price. Some 18% of listings had their price reduced last month, according to Realtor.com.
“Sellers are becoming more flexible on pricing, underscored by the price reductions we’re seeing, and while higher mortgage rates are certainly weighing on demand, the silver lining is that the market is starting to rebalance,” said Danielle Hale, chief economist at Realtor.com. "This could create opportunities for buyers who are prepared.”
FILE - A sign announcing a home for sale is posted outside a home, Thursday, Feb. 1, 2024, in Aceworth, Ga., near Atlanta. (AP Photo/Mike Stewart, File)
FILE - A housing development in Cranberry Township, Pa., is shown on March 29, 2024. (AP Photo/Gene J. Puskar, File)
ATLANTA (AP) — Georgia lawmakers on Tuesday gave final passage to a bill that aims to void a city of Savannah ordinance that imposes fines and possible jail time for leaving guns in unlocked cars.
The state Senate gave final approval to the measure, which says cities and counties can't regulate how guns are stored. It also lets gun owners sue local governments who impose any such rules in violation of state law, collecting at least $25,000 in damages if they win.
Senate Bill 204 now goes to Gov. Brian Kemp's desk for his signature or veto.
Mayor Van Johnson and Savannah’s city council voted unanimously in 2024 to outlaw keeping firearms in unlocked vehicles, with maximum penalties of a $1,000 fine and 30 days in jail. They said the law would make it harder for criminals to steal guns in a state where lawmakers have widely abolished restrictions on owning and carrying firearms.
But the rules have left gun rights advocates fuming, saying that the city is in effect punishing gun owners who had their guns stolen.
“Ultimately what Savannah was doing was regulating citizens' right to have a gun in their car,” former state Sen. Colton Moore, a Republican from Trenton, told The Associated Press. “Their car was getting broken into, and they were going from a victim of a crime now to being a criminal. And that’s what we don’t want to happen going forward.”
Moore resigned from the Senate Tuesday after the bill passed because he filed to run for the congressional seat left vacant by U.S. Rep. Marjorie Taylor Greene’s resignation.
Johnson said Tuesday that if Kemp signs the bill into law, the city will stop issuing citations.
“Obviously we’re going to comply with the law,” Johnson said in a phone interview with the AP. “So should the governor sign it, we won’t enforce that ordinance anymore. But there might be other ordinances that come forth.”
He declined to say what other type of gun safety measure city officials might consider.
Johnson, a Democrat and former police officer, has touted the gun ordinance as a way to make gun owners act responsibly without infringing on their rights to own or carry firearms. He said Tuesday that the number of gun thefts from unlocked vehicles reported to Savannah police had dropped 30% since the ordinance took effect.
“It’s a sad thing that the General Assembly says over 200 guns stolen from unlocked vehicles is OK,” the mayor said.
Georgia law already prohibits city and county governments from regulating firearm “possession, ownership, transport, carrying, transfer, sale, purchase (or) licensing.”
Savannah city officials have insisted since the gun ordinance took effect that they were regulating storage of firearms, something the state law didn’t explicitly forbid. State lawmakers changed that by adding the word “storage” to the existing law.
Gun control advocates said lawmakers were wrong to preempt Savannah's ordinance.
“Time and time again, young people in this state are told that our safety isn’t a priority. But this bill takes it a step further by actually punishing the cities that are stepping up to protect us when our state lawmakers won’t,” Nolan Tanner said in a statement. He is a volunteer with the chapter of Students Demand Action at Jenkins High School in Savannah.
In November, a Chatham County Recorder’s Court judge threw out the case of a man cited for violating the Savannah gun ordinance, ruling that it violates state law and the U.S. Constitution.
However, that ruling only applied to the case of the defendant who challenged the gun ordinance as part of his criminal defense. Johnson said at the time the city would keep enforcing it.
Johnson also said he is not worried about the additional legal liability and potential fines spelled out in the bill.
"I don’t believe it could be retroactive,” he said.
Bynum reported from Savannah, Georgia.
Republican Colton Moore, who resigned from the state Senate to run for Congress, poses for a photo outside the Georgia Capitol, Tuesday, Jan. 13, 2026, in Atlanta. (AP Photo/Jeff Amy)
FILE - Mayor Van Johnson speaks at a news conference, March 11, 2020, in Savannah, Ga. (AP Photo/Russ Bynum, File)
