Housing Affordability in Swing States: Costs Nearly Double Since 2020

The median monthly housing payment in U.S. swing states has surged by 92% since the 2020 presidential election, rising to a record $2,161. This dramatic increase, driven by soaring home prices and mortgage rates, has pushed homeownership out of reach for many typical families. A household earning the median swing-state income would now need to spend 32.8% of their earnings on the median-priced home, crossing the 30% threshold that defines housing cost burden. This report examines the data behind this affordability crisis and its implications.

What Constitutes Housing Affordability?

A common benchmark for housing affordability is that a household should not spend more than 30% of its gross income on monthly housing costs, including mortgage principal, interest, property taxes, and insurance (often abbreviated as PITI). When costs exceed this threshold, it is considered a cost burden, leaving fewer resources for other essentials. Based on this standard, the typical home in a swing state has shifted from affordable to unaffordable for the median-income family since 2020.

How Much Have Housing Costs Increased?

The primary driver of the affordability crisis is the sharp rise in the median monthly housing payment, which has jumped from approximately $1,125 in 2020 to $2,161 in 2024. This 92% increase is a result of two key factors:

• Home Prices: The median home-sale price in swing states has increased by nearly 40%, reaching a record high of $316,063.
• Mortgage Rates: The average mortgage rate has more than doubled, from a historic low of around 2.65% in early 2021 to approximately 6.89% today.

The following table illustrates the dramatic change in financial requirements for buyers:

This means a family now needs an annual income of nearly $86,500 to afford the median-priced home without being cost-burdened, almost double the income required in 2020.

How Does Affordability Vary by Demographic?

The affordability crunch does not impact all demographics equally. Based on an analysis of median incomes by race, the disparity is significant:

• Black Families: A household earning the median income for Black families in swing states would need to spend 48.2% of their income on the median-priced home, a severe cost burden.
• Hispanic Families: The typical Hispanic family would spend 38.3% of their income.
• White Families: The median-priced home is just barely affordable for median-earning white families, who would spend 29.8% of their income.
• Asian Families: Affordability is less strained for Asian families, who would spend 24.8% of their income.

These disparities highlight how rising costs disproportionately affect different communities.

Why Is This a Key Issue for Voters?

Housing affordability has become a central issue in the 2024 presidential election. Surveys indicate that over 90% of Gen Z adults and at least 80% of older generations consider it an important factor in their voting decision. The sentiment is particularly strong among younger and lower-income Americans who feel locked out of the market. While rising home values benefit existing homeowners by building equity, the high cost of moving—driven by elevated rates and prices—also limits their ability to upgrade, creating a broader sense of economic unease.

What Is the Outlook for Affordability?

The root cause of the crisis is that housing costs have risen three times faster than incomes since 2020. While the market is influenced by complex factors, the anticipated easing of mortgage rates later in 2024 or 2025 could provide some relief for buyers. However, a lasting solution also depends on increasing the supply of homes for sale to help moderate price growth.

For prospective homebuyers in today's market, the key takeaways are:

• Affordability has fundamentally shifted since 2020, requiring a much higher income or a larger down payment.
• Getting pre-approved is essential to understand your true budget based on current rates.
• Expanding your search to smaller markets or different property types, such as a condominium (condo), which is a privately owned unit within a larger building complex, may reveal more affordable options.