The Real Story Behind Today’s Affordability Crunch
The housing market isn’t crashing. It isn’t on the verge of a correction. And it isn’t heading backward.
After spending the past month breaking down the last three years of the “wait and see” market mindset, I think it’s safe to say we’re officially past the guessing phase. Even in neighborhoods where prices have flattened, we’re still digesting the impact (or depending on your perspective… the momentum) of nearly a 50% increase in single-family home prices since 2019. That kind of shift doesn’t unwind overnight.
And that’s left buyers, sellers, and policymakers all asking the same question: If prices aren’t dropping and rates aren’t returning to pandemic levels… what happens next?
As your real estate resource, my job isn’t just to tell you what the market is doing. It’s to help you understand what the market is telling us about where we’re headed, so you can make smart, confident decisions whether that’s buying, selling, or staying put for now.
As we wrap up 2025, one theme is louder than anything else: affordability.
It’s the pressure point for buyers at every price level. It’s the constraint many sellers are navigating. And it’s the challenge nearly every household is trying to solve.
So let’s break down the key forces shaping affordability right now, how to think about buying or selling in this “new normal,” and (just for fun) a few “if I ran the housing world” ideas I wouldn’t be shocked to hear floated in 2026.
The 50-Year mortgage?
You’ve probably seen the headlines: “50-Year Mortgages Are Coming.” That’s not innovation. That’s desperation.
Anytime governments or lenders start seriously discussing 40 or 50-year loan terms, it’s a sign the math of homeownership has stopped working. (Can confirm.)
This isn’t a new experiment. Countries like Japan and the UK turned to ultra-long mortgages when home prices rose far beyond what local incomes could support. The result? Prices rose even faster, homeownership rates fell (especially for younger buyers), and affordability… did not improve.
Stretching the loan instead of fixing the system is a pretty clear signal: We haven’t addressed the root problem.
The ingredients of affordability
At its simplest, affordability improves when one of three levers moves:
Mortgage rates fall
Home prices decline
Incomes grow faster than both
For the past six years, none of those levers have aligned.
Rates jumped from 3% money to 6–7% money. Prices rose more than 50% and stayed sticky due to record-low inventory. Incomes grew but nowhere near fast enough to offset the new mortgage math. That’s why the market feels tight even when activity slows.
To compound things further, we’ve effectively lost a decade of would-be homebuyers entering the market. In 2010, the typical first-time buyer spent about 12 years of adult life renting before buying a home (around age 30). Today that number is 22 years, with the average first purchase happening closer to age 40.
That’s a 76% increase in the time it takes to reach homeownership.
Put differently: we’ve added nearly an entire decade of renting and waiting before someone can realistically buy their first home and build equity. That single shift explains why affordability dominates today’s housing conversation.
It’s not that people don’t want to buy, it’s that the goalposts keep moving faster than most can run.
People are moving for affordability NOT lifestyle
For decades, people moved to upgrade their home, accommodate a growing family, or relocate for work. In 2010, “cost of living” wasn’t even tracked as a primary reason for moving.
Today? Nearly half of all movers in 2025 cite cost of living as their main reason for relocating.
A decade ago, people moved for a better home. Now, nearly 50% move just to afford any home.
Migration patterns are being driven by affordability math, not lifestyle aspirations. And that has major implications for where demand shows up next.
My take (and a few predictions)
The solution isn’t 50-year mortgages. It isn’t waiting for 3% rates to magically return. And it isn’t hoping for a price collapse that shows no real signs of arriving.
Real affordability solutions require improving supply, lowering cost barriers, and expanding access.
That looks like zoning reform and gentle density, for example, allowing duplexes, triplexes, and townhomes in more neighborhoods. It looks like meaningful first-time buyer assistance that actually impacts monthly payments, not just headlines. It looks like unlocking underutilized land and converting vacant office space into housing where demand already exists.
If builders committed to producing homes closer to the median price, and states or counties waived certain fees, offered tax incentives, or sped up approvals, we’d open the door to an entirely different level of possibility.
These solutions take effort. But unlike ultra-long mortgages, they address the actual root causes of unaffordability. And my guess? We’re going to start hearing a few of these ideas discussed much more seriously and very soon.
So… what does this mean right now?
The market has stabilized. The fear of a crash has faded. But affordability is the defining issue heading into 2026.
That doesn’t mean buying or selling is impossible. It just means strategy matters more than ever.
This isn’t the housing market of decades past. We’re firmly in a “new normal” and while I personally don’t love that phrase either, the people who adapt and stay flexible are the ones who win.
Creative deal structures, payment-focused planning, strong negotiation, and paying attention to how affordability is being addressed at the policy level are how we make your sale or search incredibly successful in today’s market.
And that’s exactly where I come in.
XO - Gee
