The National Association of Home Builders (NAHB) recently released its 2025 Priced-Out Analysis, highlighting the ongoing housing affordability challenge. The report uses a U.S. housing affordability pyramid to illustrate the number of households able to purchase homes at various price steps.
According to the analysis, 70% of households (94 million) cannot afford a $400,000 home, with the estimated median price of a new home expected to reach around $460,000 in 2025. The pyramid shows that households can only afford homes within specific price ranges, with the majority falling within the first step, priced under $200,000.
To purchase a $200,000 home, households need a minimum income of $61,487, based on a mortgage rate of 6.5%. As of 2025, approximately 52.87 million households in the US meet this threshold and can only afford homes priced up to $200,000. This represents about 53% of all households that cannot afford higher-priced homes.
The analysis reveals significant imbalances between household affordability and available housing units. For example, while around 53 million households can afford homes priced at $200,000 or less, there are only 22 million owner-occupied homes valued in this price range. This shortage of affordable housing is a critical challenge for households with lower incomes.
The NAHB’s report underscores the need for policymakers to address the root causes of housing affordability issues and provide solutions to support low-income households in accessing affordable housing options.
Source: https://eyeonhousing.org/2025/03/affordability-pyramid-shows-94-million-households-cannot-buy-a-400000-home