Homebuying options remain slim for middle-income earners – JS

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By Tim Henderson, Stateline.org

Public school teachers Julia and Scott Whitnall, like many moderate-income workers, didn’t think they’d become homeowners in their early 30s, especially in California.

“We never felt homeownership was in our cards. But we did it!” Julia Whitnall said. “We’re extremely happy.”

The couple moved to a $509,000 two-bedroom house in Ripon, east of San Francisco in the Central Valley region on May 16.

Despite their relatively high combined income of $140,000 from their nearby jobs, they had to compromise on size and take on extra work at summer camps to make it happen. They also had to be patient as the sellers struggled to find a new home.

High interest rates and high prices in a still-competitive housing market continue to make it tough for first-time buyers, even those with good but moderate incomes.

According to new research by the National Association of Realtors and Realtor.com, households making $75,000 to $100,000 face a lack of affordable homes. In March of this year, they could only afford 21.2% of homes on the market, compared to almost half in 2019.

California, Hawaii, Idaho, Massachusetts, and Montana are among the states with the largest affordability gaps, where such households can afford fewer than 12% of houses on the market. On the other hand, states like Illinois, Indiana, Iowa, Ohio, and West Virginia have more affordable options.

There’s progress in states like Arizona, Colorado, Delaware, Florida, and Utah, which are adding more housing at moderate price points, according to the Realtors report.

To get home markets back in line with moderate-income families nationwide, the United States needs 416,000 more homes for sale at or below $255,000, the report suggests.

“In many places, we’re still seeing a huge mismatch between income levels and what’s available to buy for moderate-income families,” said Nadia Evangelou, the National Association of Realtors’ senior economist and director of real estate research.

Teachers, who generally make less than nurses or trades workers, are particularly squeezed. Some states are working to raise teacher pay to help with the housing affordability crisis.

One way to make homebuying more feasible for teachers is to pay them more. New Mexico saw a 60% increase in pay for beginning teachers between 2019 and 2025, which helped offset a 65% jump in home prices, according to a report by the National Council on Teacher Quality.

“We’re dealing with the issue of teachers being able to live in the communities where they’re actually working,” said state Rep. [Last Name].

Joy Garratt, a Democratic lawmaker, has successfully sponsored a new law that was signed in April. This law mandates higher minimum salaries for teachers, which will take effect on July 1.

In addition to this positive development, Detroit schools have also implemented a pay increase of up to 50% for teachers with advanced degrees since 2019. This increase is comparable to the rise in home prices, as reported by the National Council on Teacher Quality. Albuquerque and Detroit have been recognized in the report as two of the most affordable places for new teachers to live.

Despite these localized improvements, the report highlights a concerning national trend. On average, experienced teachers who entered the profession in 2019 are now finding it more difficult to afford a home compared to when they first started.

Heather Peske, the president of the organization behind the report, pointed out that while teacher pay has increased by 24% over the last five years, housing prices have surged by 47%. This disparity poses a significant challenge in attracting and retaining talented educators.

Peske emphasized the importance of competitive housing prices in ensuring the retention of skilled teachers. Without adequate compensation, educators may be compelled to leave the profession in search of better-paying opportunities, ultimately impacting the quality of education for students.

For more information, contact Stateline reporter Tim Henderson at thenderson@stateline.org.