Food, clothing and shelter…the most basic human needs.
The cost of housing has been rising relentlessly.
Based on the most recent data available:
Median household income: $80,610 (2023, U.S. Census Bureau)
Median cost of an existing single-family home: $418,000 (April 2025, YCharts/FRED)
The number of years of income it takes to buy a house in the U.S. has been increasing significantly and varies depending on current market conditions, interest rates, and the specific location.
Here’s a breakdown of recent data:
- Income Needed to Afford a Median Home:
- According to Realtor.com, in April 2025 , it required an annual income of $114,000 to afford a median U.S. home priced at $431,250. This assumes a 20% down payment, a 30-year fixed mortgage, and the 30% rule for housing expenses.
- The latest U.S. Census Bureau data shows that the median household income in 2023 was $80,610.
Years of income = Median Home Price / Median Household Income Years of income = $430,000 / $80,610 ≈ 5.33 years
To calculate how many years of median income it would take to buy a median-priced home in 2000, we divide the median home cost by the median household income:
Years of Income = Median Cost of Home / Median Household Income Years of Income = $119,600 / $42,148 ≈ 2.84 years
This means that in 2000, it would have taken approximately 2.84 years of the median household income to purchase a median-priced single-family home. This is significantly lower than the current figures, highlighting the change in housing affordability over the past two decades.
There are many hidden costs to ownership.
Comparing the median cost of renting to the median cost of ownership reveals a complex picture, with ownership generally being more expensive in the short term, but offering long-term benefits. It’s crucial to look beyond just the monthly payment for a comprehensive comparison.
Here’s a breakdown of current (late 2024 to mid-2025) data:
Median Cost of Renting:
National Median Monthly Rent: Data from late 2024 shows the national median monthly rent around $1,373 - $1,761. This range exists because different sources use slightly different methodologies (e.g., median asking rent for specific unit sizes, or averages across all units).
Apartment List reported a national median monthly rent of $1,373 in December 2024.
RentCafe reports an average rent of $1,761 for an apartment in the U.S. as of May 2025.
What's included in rent: Typically, rent covers the cost of using the property. Utilities (electricity, gas, water, internet) may or may not be included, so this needs to be factored in. Renters usually aren't responsible for property taxes, homeowner's insurance (though they might get renter's insurance), or major repairs.
Median Cost of Ownership (Monthly):
The median cost of ownership is more complex because it includes several components:
Mortgage Principal & Interest (P&I): This is the core loan repayment.
For January 2025, the median monthly mortgage payment for applicants was around $2,205 - $2,225 (Mortgage Bankers Association data).
Some estimates for 2024 put the typical monthly mortgage payment around $2,207 (Bankrate).
The median monthly mortgage payment in April 2025 was reported as $2,186 (The Motley Fool).
These figures often assume a 20% down payment and a 30-year fixed mortgage, but do not include property taxes or other costs.
Property Taxes: These vary significantly by location.
The average homeowner spends about $4,316 - $4,420 per year on property taxes, which equates to roughly $360 - $368 per month. (Bankrate, Real Estate Witch, 2024 data).
Homeowners Insurance: Another variable cost.
The average homeowner spends about $1,854 - $2,267 per year on homeowners insurance, roughly $154 - $189 per month. (REsimpli, Bankrate, 2024/2025 data).
Utilities: While renters also pay utilities, homeowner utilities can sometimes be higher due to larger spaces.
Average homeowner utility costs are around $5,362 per year, or about $447 per month (Real Estate Witch, 2024).
Maintenance, Repairs, and Improvements: A significant hidden cost of homeownership.
The average homeowner spends about $4,392 - $4,400 per year on maintenance and $3,784 on renovations, totaling around $8,176 - $8,184 per year, or roughly $681 - $682 per month (Real Estate Witch, 2024).
Bankrate's "Hidden Costs of Homeownership Study" for 2025 estimates average annual costs beyond the mortgage (including property taxes, insurance, utilities, maintenance, etc.) at $21,400, which is about $1,783 per month.
Total Estimated Monthly Cost Comparison (National Medians/Averages):
Renting (Median): Approximately $1,373 - $1,761 (excluding utilities in some cases, which could add a few hundred dollars).
Ownership (Median/Average):
Mortgage P&I: ≈ $2,186 - $2,225
Property Taxes: ≈ $360 - $368
Homeowners Insurance: ≈ $154 - $189
Utilities (for homeowners): ≈ $447
Maintenance/Repairs/Improvements: ≈ $681 - $682
Total estimated monthly cost of ownership (summing these up):
Low end: $2,186 + $360 + $154 + $447 + $681 = $3,828
High end: $2,225 + $368 + $189 + $447 + $682 = **$3,911** Alternatively, using Bankrate's "Hidden Costs" figure: * Mortgage P&I ($\approx$ 2,207)+HiddenCosts(\approx$ $1,783) = $3,990
Conclusion:
Based on current national median/average figures for late 2024/early 2025:
The median monthly cost of renting in the US is roughly $1,400 - $1,800.
The median monthly cost of home ownership (including mortgage, taxes, insurance, utilities, and maintenance) is significantly higher, often in the range of $3,800 - $4,000 per month.
Ownership is currently more expensive monthly than renting in most U.S. markets. Recent studies from Bankrate and SmartAsset confirm this, with Bankrate stating that “renting is increasingly more affordable than buying” in 2025, and an average mortgage payment costing 38% more than average rent.
Long-term vs. Short-term: While monthly ownership costs are often higher, owning a home offers potential long-term benefits like building equity, tax deductions, and appreciation, which renting does not. However, these benefits are not guaranteed and depend on market conditions.
I decided many years ago to pay off our house because this put housing under our control. DH and I have not paid a mortgage or rent since 1990. We live in a modest home which is sufficient for our needs.
Of course, all of this depends upon the specific market. Rents are climbing also.
For individuals, the rising price of housing leads to cost burdening and potentially to homelessness. For example, in 2022, a full-time worker needed to earn an average of $25.82 per hour to afford a modest two-bedroom rental, while the national minimum wage was only $7.25. Older adults relying on Social Security, or individuals with disabilities on Supplemental Security Income (SSI), often have incomes that are woefully inadequate to cover rising rents. For example, in Seattle in 2025, the maximum SSI benefit of $967 per month is far less than the average rent for even an efficiency apartment ($2,238).
Adults aged 50 and older are consistently cited as the fastest-growing age group among those experiencing homelessness. Some projections estimate that their numbers could nearly triple by 2030 . Recent data from the U.S. Department of Housing and Urban Development (HUD) indicates that approximately 20% of the total homeless population in 2024 was aged 55 and older , accounting for over 140,000 individuals. This proportion has been steadily increasing for the past three decades.
For investors, rising rents present an opportunity via REITs and REIT ETFs. REITs are legally required to distribute at least 90% of their taxable income to shareholders as dividends, making them attractive for income-focused investors. As with any investment, it’s important to research individual REITs or ETFs to understand their specific holdings, financial health, management, and market focus before investing.
Homelessness and the lack of affordable housing is a huge issue in our remote rural area. The Port Angeles, WA city council discusses homelessness as the #1 problem to be addressed.
This past week, I was contacted by a middle-aged man from whom I bought firewood in the past. It’s warm at this time of year and people aren’t buying firewood. Would I like to buy some firewood?
Actually, this is the ideal time to buy firewood since it has time to dry before winter. Yes, I would like to buy 2 cords of firewood. Paid in cash because he needs to put gas into his truck. (Meaning he was flat broke.)
Would I like to rent him the unoccupied cabin on my property? He would be willing to pay a few hundred dollars a month and do all the work I need on my property. He is having a hard time getting the $1200 per month he is paying for his apartment.
Sorry, my husband is dead set against anyone living on our property. The cabin is in good condition and furnished. Sometimes we have guests. If we needed live-in help I could get someone without a problem.
Wendy