The Math Has Shifted for Every Buyer
The median American household now spends roughly 40% of its income on housing payments, up from about 28% before the pandemic in 2019, according to an analysis from Realtor.com and Bright MLS covered by RISMedia. Getting back to 2019-level affordability would require either a home price decline of more than 30% or mortgage rates falling to around 3%, and the analysis says neither is likely.
Rates Just Hit a 13-Month High
Freddie Mac reported on September 3, 2026 that the average 30-year fixed mortgage rate climbed to 6.71%, up from 6.66% the prior week and 6.50% a year earlier, its highest level in 13 months. The 15-year fixed rate rose to 6.04%.
Why Rates Aren’t Coming Down Soon
Jiayi Xu, senior economist at Realtor.com, said in the analysis cited by RISMedia that mortgage rate relief is unlikely this fall, warning that if inflation isn’t tamed, the pain will be real. Xu pointed to Middle East conflict pushing oil prices higher, which has revived inflation concerns and pushed bond yields, and therefore mortgage rates, back up after a brief decline earlier this year.
The Fed Isn’t Promising Relief Either
The pressure on rates is compounded by uncertainty at the Federal Reserve. Fed Chair Kevin Warsh said following his Jackson Hole remarks that inflation has stayed elevated too long and that policy rates remain the central tool for addressing it. RISMedia reported that 57% of traders were betting on a Fed rate hike at the September FOMC meeting.
One Bright Spot
There is a small counterweight to the squeeze. Xu noted that home prices continue to decline in many markets and that the share of listings with price cuts is at its highest level so far this year, giving buyers some room to negotiate even as borrowing costs climb. It is not enough to undo a decade-scale shift in what housing costs relative to what families earn, but for a household stretching to make a 40% housing payment work, every price cut still counts.
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