A Zillow analysis of the 2024 housing market reveals a stark difference in the income needed to secure a home at an affordable price in 2024 versus 2020. The annual income necessary to comfortably buy a house in January 2024 is up by 80%, requiring over $106,000 on average, and most homebuyers must earn at least $47,000 more than they did in January 2020 to afford a home today. Home values have increased by 42.4% since 2020, with the typical house worth $343,000. However, mortgage rates have also risen from 3.5% to 6.6%. While the housing market has risen significantly, the median income has only increased by 23%, according to Zillow. With insurance premiums on the rise in most of these states, potential homebuyers face an uphill battle to secure a home within their budget and afford the cost of homeowners insurance. In Zillow's breakdown, Pittsburgh, Memphis and Cleveland were the most affordable housing markets, with annual incomes needed to buy a home at $58,232, $69,976 and $70,810, respectively. The least affordable city was San Jose, with an annual salary of $454,296 needed to purchase a home — an unsurprising winner with California being notoriously expensive in all arenas. |

Millennials and Gen Z are 'house hacking'

With the monthly mortgage amount up 96.4% since January 2020, even with 10% down, it's no surprise that millennials and Gen Z are finding their own workarounds. Younger generations can't afford to wait an average of 8.5 years to save enough money to purchase a home with 10% down without ending up "house poor." Some homebuyers are partnering with their friends and family or renting out areas of the home to afford the mortgage — 21% of homebuyers in 2023 reported co-buying their home. "Buyers are getting creative to make a purchase pencil out, and long-distance movers are targeting less expensive and less competitive metros," said Zillow Senior Economist Orphe Divounguy. "Mortgage rates easing down has helped some, but the key to improving affordability long term is to build more homes." The slideshow above lists the 10 least affordable markets to buy a home as of January 2024, according to Zillow's analysis data. Related: |

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