---
title: Americans Need $70,693 to Afford a Starter Home and $109,796 for a Typical One
description: A median American household now earns about $17,000 more than a starter home requires, and $22,197 less than a typical home costs.
author: Darie Nani (Editor-in-Chief)
updated: 2026-08-05T21:16:46.701Z
canonical: https://richdadmagazine.com/article/income-needed-starter-home-versus-typical-home-june-2026
image: https://cdn.nanimediahouse.com/starter-home-affordability-keys-106722.webp
categories: Money & Legacy
content_type: News
region: United States
publication: Rich Dad Magazine
schema_type: Article
---

A household earning the median American income can now afford a typical starter home, with about $17,000 a year to spare. Buying a typical home, rather than an entry-level one, still takes $22,197 more than that household brings in.

It takes $70,693 to afford the typical US starter home, down 1.5% over the year and the eighth straight month of declines, according to Redfin's analysis of June sales. The typical American household earns an estimated $87,599, up 4% year over year. A year ago the cushion was about $12,500.

The threshold for the market as a whole is $109,796, down 0.5% from an all-time high of $110,382 a year ago. The shortfall against a median income has narrowed from $26,125 a year ago and $28,834 two years ago. Affordable, in these figures, means a mortgage payment on a 15% down payment that takes no more than 30% of income.

## The 30-Year Rate Has Risen Every Week Since Early July

Those June figures rest on a 30-year fixed mortgage rate that averaged about 6.49% that month, according to Freddie Mac's Primary Mortgage Market Survey. It has risen every week since early July, reaching [6.66% in the week ending July 30](https://www.freddiemac.com/pmms), the highest weekly average since July 31 last year. A household running the numbers today is doing so against a more expensive loan than the one behind the June data.

Incomes are still growing a little faster than housing costs. The median US home sale price rose 2.2% over the year in June, and 34.2% of listings were affordable to a median earner, up from 30.5% a year earlier. Before rates climbed in 2022, more than half of listings cleared that bar in nearly every month on record back to 2013.

“The earnings needed to buy a house have stabilized after several years of deterioration, but that doesn’t mean homes are affordable to the average American,” said Yingqi Xu, a senior economist at Redfin. “There’s still a double-digit gap between what the typical household earns and what they need to comfortably buy a home, leaving many prospective first-time buyers stalled on the sidelines.”

## In Detroit a Starter Home Takes 13.9% of a Median Income

Every starter-home listing is affordable to a median-earning household in 22 of the metros in the analysis, close to half, most of them in the South and the middle of the country. Detroit is the cheapest, at 13.9% of a median income, followed by Pittsburgh at 14.8% and St. Louis at 14.9%. Entry-level affordability improved in 30 of the 50 largest metro areas.

Only three metros, St. Louis, Indianapolis and Pittsburgh, have a median income above what the typical home costs rather than just the entry-level one. Even there, first-time buyers are bidding against move-up buyers who bring equity from a previous sale.

## Almost No Starter Home Is Affordable in San Diego, Los Angeles or San Francisco

In San Diego, Los Angeles and San Francisco, virtually no starter-home listing is affordable to a household on the local median income. Anaheim has 2.6% of listings within reach, San Jose 7.4%. A median earner in Los Angeles would put 51% of income toward a starter home, the highest share of any metro in the analysis, ahead of Anaheim at 47.6% and San Francisco at 47.3%. A typical starter home runs to nearly $1 million in the Bay Area and around $650,000 in San Diego and Los Angeles.

## The Income Needed to Buy Rose Fastest in Pittsburgh

Pittsburgh is one of the cheapest places to buy an entry-level home, and the place where the cost of buying a typical one rose fastest. The income needed for the median-priced local home rose 6.3% over the year to $82,816, the steepest increase in the analysis. San Francisco buyers need $453,205, more than anywhere else in the country and up 6.2%, and West Palm Beach rose 5.6% to $146,404.

Seattle moved furthest the other way, down 7.4% to $221,831 as prices there fell more than in any other metro. San Jose followed at $423,840, down 6.5%, which still leaves a local median income of $176,401 about $250,000 short of a typical home.

Redfin economists expect affordability to improve slightly more by the end of the year, though it could worsen if the Federal Reserve raises rates more than expected, oil prices climb further, or the AI boom pushes inflation higher.

## FAQ

**Q: What is a starter home?**
In Redfin's analysis a starter home is one priced in the 5th to 35th percentile of sale prices in its market.

**Q: How much do you need to make in 2026 to afford a house?**
On June 2026 sales, a buyer needs $70,693 for a typical starter home and $109,796 for a typical home overall, assuming a 15% down payment and monthly housing costs no higher than 30% of income.

**Q: Why can't Americans find starter homes?**
Prices at the entry level are still rising, up 1.2% year over year in June. Move-in-ready homes draw the strongest demand, while fixer-uppers appeal less to buyers who have little financial cushion for renovation work.