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Housing affordability has declined at a significant rate in recent years, primarily driven by a decrease in price-to-income ratio, according to an analysis from the National Association of Home Builders (NAHB).
Home prices have risen 53% since 2019, while median household income has increased by only 24% in the same time frame. This has lowered the number of first-time home buyers, which dropped to 21% in 2025, notably lower than 44% in 1981. The median age for first-time home buyers reached a record high of 40 in 2025, compared to the median age of 29 in 1981.
“You can’t have housing prices rise that significantly for a sustained period of time and not experience housing affordability issues,” says Rose Quint, NAHB assistant vice president of survey research. “Clearly this will have implications on the size of homes we build and the types of amenities we include.”
Median home size was reported at 2,155 square feet in 2025, similar to 2024’s average of 2,150 square feet. While builders don’t expect size to change significantly in 2026, they are trying to address affordability concerns, with 67% of builders offering sales incentives and 41% cutting home prices.
