{"id":79575,"date":"2025-04-10T05:30:39","date_gmt":"2025-04-10T12:30:39","guid":{"rendered":"https:\/\/www.redfin.com\/news\/?p=79575"},"modified":"2025-05-15T09:38:52","modified_gmt":"2025-05-15T16:38:52","slug":"rent-vs-buy-income-gap-2025","status":"publish","type":"post","link":"https:\/\/www.redfin.com\/news\/rent-vs-buy-income-gap-2025\/","title":{"rendered":"Homebuyers Need to Earn Over $50,000 More Than Renters to Afford Monthly Payments\u2014And the Gap Is Widening"},"content":{"rendered":"<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><strong><i>Americans need an annual income of $117,000 to afford the typical home for sale. That&#8217;s 82% more than they need for the typical rental, up from 73% more last year. The gap is widening because home prices are rising faster than rents.<\/i><\/strong><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><strong><i>The gap is widening most in Salt Lake City and Austin, and shrinking most in Cincinnati and Providence.<\/i><\/strong><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Americans need to earn $116,633 per year to afford the median priced home for sale. That\u2019s 81.8% more than the $64,160 they need to afford the typical apartment for rent\u2014and the gap has been widening.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Last year, someone needed to earn $110,808 to afford the typical U.S. home for sale\u201473.1% more than the $64,000 needed for the typical rental. Two years ago, they needed to earn $101,341 to afford the typical home for sale\u201454.5% more than the $65,600 required for the typical rental. And back in 2021, they needed to earn $63,925 to afford the typical home for sale\u2014just 17.3% more than the $54,520 required for the typical rental.<\/span><\/p>\n<p><iframe id=\"datawrapper-chart-vIYCn\" style=\"border: none;\" title=\"Homebuyers Need to Earn Over $50,000 More Than Renters\" src=\"https:\/\/datawrapper.dwcdn.net\/vIYCn\/4\/\" width=\"600\" height=\"458\" frameborder=\"0\" scrolling=\"no\" aria-label=\"Interactive line chart\" data-external=\"1\"><\/iframe><\/p>\n<p><span style=\"font-weight: 400;\">We consider a home affordable if a buyer taking out a mortgage spends no more than 30% of their income on their monthly housing payment. This is based on a Redfin analysis of median home sale prices and median asking rents covering rolling three-month periods, along with prevailing mortgage rates and property-tax payments. This report focuses on the three months ending Feb. 28, 2025 (referred to as \u201cFebruary\u201d)\u2014the most recent period for which data is available\u2014and comparable periods in past years.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The cost of buying a home is rising faster than the cost of renting, which is why there\u2019s a growing gap between the income someone needs to afford their own home versus an apartment. The median home-sale price rose 4.5% year over year to $423,892 in February, and has been growing at roughly that pace for months. Plus, the <\/span><a href=\"https:\/\/www.freddiemac.com\/pmms\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">average<\/span><\/a><span style=\"font-weight: 400;\"> 30-year-fixed mortgage rate is hovering above 6.5%\u2014more than double the record low hit during the pandemic. The typical U.S. household earns an estimated $86,382\u2014roughly $30,000 less than the income required to afford the typical home for sale.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Meanwhile, the median asking rent rose just 0.2% year over year to $1,604 in February. Rents have stabilized below their record high because an influx of newly-built apartments ushered in by the pandemic construction boom has given renters more options. That has made it harder for landlords to boost rents. Supply in the for-sale market is more constrained\u2014partly due to the mortgage-rate <\/span><a href=\"https:\/\/www.redfin.com\/news\/mortgage-rate-lock-in-effect-eases\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">lock-in effect<\/span><\/a><span style=\"font-weight: 400;\">\u2014which is fueling bidding wars and larger price increases.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Back in 2020 and 2021, rents were skyrocketing and mortgage rates hit record lows, which is why the income needed to afford a home was only about 17% higher than the income needed to afford an apartment.<\/span><\/p>\n<p><iframe id=\"datawrapper-chart-y8L4q\" style=\"border: none;\" title=\"Income Needed to Afford a Home Is Up 5% Year Over Year\" src=\"https:\/\/datawrapper.dwcdn.net\/y8L4q\/8\/\" width=\"600\" height=\"469\" frameborder=\"0\" scrolling=\"no\" aria-label=\"Interactive line chart\" data-external=\"1\"><\/iframe><\/p>\n<p><span style=\"font-weight: 400;\">\u201cIt has become increasingly challenging for American renters to make the shift to homeownership thanks to the triple whammy of rising home prices, high mortgage rates and a shortage of houses for sale,\u201d said Redfin Senior Economist <\/span><a href=\"https:\/\/www.redfin.com\/news\/author\/elijah-delacampa\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Elijah de la Campa<\/span><\/a><span style=\"font-weight: 400;\">. \u201cThe gap between what someone must earn to buy versus rent may shrink in the coming months, but only because rents are expected to rise as the number of new apartments hitting the market tapers off due to a construction <\/span><a href=\"https:\/\/fred.stlouisfed.org\/graph\/?g=1Hl3l\"><span style=\"font-weight: 400;\">slowdown<\/span><\/a><span style=\"font-weight: 400;\">.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It\u2019s worth noting that homebuyers, sellers and renters <\/span><a href=\"https:\/\/www.redfin.com\/news\/tariffs-volatile-mortgage-rates-construction\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">may face<\/span><\/a><span style=\"font-weight: 400;\"> an extended period of economic uncertainty due to President Trump\u2019s newly announced tariffs. The tariffs could lead to some mortgage rate relief, but that\u2019s not guaranteed. They are expected to <\/span><span style=\"font-weight: 400;\">bring higher construction costs, higher home prices, higher unemployment and slower economic growth.<\/span><\/p>\n<h3><b>Salt Lake City and Austin See Biggest Jumps in Homebuying Premium\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\"><br \/>\nIn <\/span><a href=\"https:\/\/www.redfin.com\/city\/17150\/UT\/Salt-Lake-City\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Salt Lake City<\/span><\/a><span style=\"font-weight: 400;\">, someone needs an annual income of $140,412 to afford the typical home for sale. That\u2019s 134% more than they need to afford the typical rental. By comparison, they only would have needed to earn 106% more last February. That 28-percentage-point increase is the largest increase among the 42 core-based statistical areas (CBSAs) Redfin analyzed.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Next came <\/span><a href=\"https:\/\/www.redfin.com\/city\/30818\/TX\/Austin\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Austin, TX<\/span><\/a><span style=\"font-weight: 400;\"> (+24.6 ppts to 143%), <\/span><a href=\"https:\/\/www.redfin.com\/city\/16904\/CA\/San-Diego\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">San Diego<\/span><\/a><span style=\"font-weight: 400;\"> (+21.7 ppts to 127%), <\/span><a href=\"https:\/\/www.redfin.com\/city\/30749\/NY\/New-York\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">New York<\/span><\/a><span style=\"font-weight: 400;\"> (+20.7 ppts to 76%) and <\/span><a href=\"https:\/\/www.redfin.com\/city\/11203\/CA\/Los-Angeles\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Los Angeles<\/span><\/a><span style=\"font-weight: 400;\"> (+20.7 ppts to 141%).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In most of these places, asking rents are falling while home prices are rising, which is why the gap is widening. Take Salt Lake City, for example. Asking rents in the Utah capital fell 7.8% year over year in February\u2014the second biggest decline among the places Redfin analyzed (Austin was first, with a 10.1% drop)\u2014while home prices rose 4.3%.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Rents are falling sharply in pandemic boomtowns including Austin because a lot of new apartments have been hitting the market. And home prices are rising sharply in big cities like <\/span><a href=\"https:\/\/www.redfin.com\/news\/hottest-neighborhoods-2025\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">New York<\/span><\/a><span style=\"font-weight: 400;\"> as major urban areas make a <\/span><a href=\"https:\/\/www.redfin.com\/news\/homes-sold-above-list-price-2025\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">comeback<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<table>\n<tbody>\n<tr>\n<td><b>CBSA<\/b><\/td>\n<td><b>Y\/Y change in median home sale price<\/b><\/td>\n<td><b>Y\/Y change in median asking rent<\/b><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Salt Lake City, UT\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">4.3%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">-7.8%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Austin-Round Rock-Georgetown, TX\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">-1.3%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">-10.1%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">San Diego-Chula Vista-Carlsbad, CA\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">3.4%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">-5.7%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">New York-Newark-Jersey City, NY-NJ-PA\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">8.6%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">-4.5%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Los Angeles-Long Beach-Anaheim, CA\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">7.1%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">-1.6%<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h3><b>Cincinnati and Providence See Biggest Drops in Homebuying Premium\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\"><br \/>\nIn Cincinnati, someone needs an annual income of $80,752 to afford the typical home for sale. That\u2019s 38.9% more than they need to afford the typical rental. By comparison, they would have needed to earn 47.7% more last February. That 8.7-percentage-point decrease is the largest increase among the CBSAs Redfin analyzed.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Only five other CBSAs saw decreases: Providence, RI (-7.5 ppts to 57.6%), Washington, D.C. (-5.7 ppts to 88%), Baltimore (-5 ppts to 63.8%), Louisville, KY (-4.7 ppts to 43.2%) and Sacramento, CA (-1.3 ppts to 98%).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In all of these places, rents are rising faster than home prices, which is why the gap is shrinking. In Cincinnati, the median asking rent jumped 15.3% year over year in February\u2014the biggest jump among the places Redfin analyzed and roughly double the 7.8% gain in the local median sale price.<\/span><\/p>\n<table>\n<tbody>\n<tr>\n<td><b>CBSA<\/b><\/td>\n<td><b>Y\/Y change in median home sale price<\/b><\/td>\n<td><b>Y\/Y change in median asking rent<\/b><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Cincinnati, OH-KY-IN\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">7.8%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">15.3%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Providence-Warwick, RI-MA\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">6.7%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">12.2%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Washington-Arlington-Alexandria, DC-VA-MD-WV\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">4.2%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">8.1%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Baltimore-Columbia-Towson, MD\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">5.3%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">9.1%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Louisville\/Jefferson County, KY-IN\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">3.6%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">8.2%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Sacramento-Roseville-Folsom, CA\u00a0<\/span><\/td>\n<td><span style=\"font-weight: 400;\">2.8%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">4.4%<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">\u201cThe increase in rents is definitely having an impact on the for-sale market\u2014a lot of people are looking to buy instead of rent, and many of those people are first-time homebuyers in their mid-to-late twenties,\u201d said <\/span><a href=\"https:\/\/www.redfin.com\/real-estate-agents\/cody-brownfield\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Cody Brownfield<\/span><\/a><span style=\"font-weight: 400;\">, a <\/span><a href=\"https:\/\/www.redfin.com\/premier\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Redfin Premier<\/span><\/a><span style=\"font-weight: 400;\"> real estate agent in Cincinnati. \u201cThere are a lot of new apartment complexes here, but not enough to keep up with demand, which is one reason rents have been rising. Plus, a lot of new apartments are expensive because they\u2019re in luxury buildings, so many people figure they can get more bang for their buck by buying.\u201d<\/span><\/p>\n<p><iframe id=\"datawrapper-chart-k4vD0\" style=\"border: none;\" title=\"Homebuying Premium Jumps Most in Salt Lake City\" src=\"https:\/\/datawrapper.dwcdn.net\/k4vD0\/14\/\" width=\"675\" height=\"943\" frameborder=\"0\" scrolling=\"no\" aria-label=\"Range Plot\" data-external=\"1\"><\/iframe><\/p>\n<h3><\/h3>\n<h3><b>The Bay Area Has the Biggest Homebuying Premium; Pittsburgh Has the Smallest<br \/>\n<\/b><\/h3>\n<p><span style=\"font-weight: 400;\"><br \/>\nIn San Jose, CA, someone needs an annual income of $408,557 to afford the typical home for sale. That\u2019s 218% more than they need to afford the typical apartment for rent\u2014the biggest premium among the CBSAs Redfin analyzed. Next come San Francisco (176%), Seattle (145%), Austin (143%) and Los Angeles (141%).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Most of these places are West Coast tech hubs that have long been known as expensive. The $408,557 someone must earn to afford the typical San Jose home for sale is the highest in the nation. Someone in San Jose must earn $128,580 to afford the typical apartment for rent. That\u2019s also the highest in the country, but pales in comparison to the income needed to buy a home in San Jose.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Of note is that New York also has a reputation for being expensive, but is not in the top five list above. That\u2019s because there isn\u2019t as big of a gap between rents and home prices. Someone in New York needs to earn $199,708 to afford the typical home for sale\u201476% more than the $113,440 they need to afford the typical apartment. New York is the sixth most expensive place to buy a home, but the second most expensive place to rent an apartment.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In Pittsburgh, someone needs an annual income of $66,350 to afford the typical home for sale. That\u2019s just 14.4% more than they need to earn to afford the typical apartment for rent\u2014the smallest premium among the CBSAs Redfin analyzed. Next come Cleveland (29.7%), Detroit (30.7%), Cincinnati (38.9%) and Philadelphia (40.9%). Most of these are among the most affordable places to buy a home in the country.<\/span><\/p>\n<h3><b>CBSA Summary: Three Months Ending Feb. 28, 2025<\/b><\/h3>\n<p><i><span style=\"font-weight: 400;\">The table below includes 42 of the 50 most populous U.S. CBSAs\u2014those for which Rent. and Redfin have sufficient rental data. The national figures are based on data for the entire U.S.<\/span><\/i><\/p>\n\n<table id=\"tablepress-448\" class=\"tablepress tablepress-id-448\">\n<thead>\n<tr class=\"row-1\">\n\t<th class=\"column-1\"><strong>CBSA<\/strong><\/th><th class=\"column-2\"><strong>Income required to afford typical home for sale<\/strong><\/th><th class=\"column-3\"><strong>Y\/Y change: Income required to afford typical home for sale<\/strong><\/th><th class=\"column-4\"><strong>Income required to afford typical apartment for rent<\/strong><\/th><th class=\"column-5\"><strong>Y\/Y change: Income required to afford typical apartment for rent<\/strong><\/th><th class=\"column-6\"><strong>Income premium required to afford typical home over typical apartment<\/strong><\/th><th class=\"column-7\"><strong>Y\/Y change: Income premium required to afford typical home over typical apartment<\/strong><\/th><th class=\"column-8\"><strong>Median home sale price<\/strong><\/th><th class=\"column-9\"><strong>Median asking rent\u00a0<\/strong><\/th>\n<\/tr>\n<\/thead>\n<tbody class=\"row-striping row-hover\">\n<tr class=\"row-2\">\n\t<td class=\"column-1\">Atlanta-Sandy Springs-Alpharetta, GA\u00a0<\/td><td class=\"column-2\">$107,145 <\/td><td class=\"column-3\">2.4%<\/td><td class=\"column-4\">$61,000 <\/td><td class=\"column-5\">0.7%<\/td><td class=\"column-6\">75.6%<\/td><td class=\"column-7\">3.0 ppts<\/td><td class=\"column-8\">$385,868 <\/td><td class=\"column-9\">$1,525 <\/td>\n<\/tr>\n<tr class=\"row-3\">\n\t<td class=\"column-1\">Austin-Round Rock-Georgetown, TX\u00a0<\/td><td class=\"column-2\">$135,841 <\/td><td class=\"column-3\">0.1%<\/td><td class=\"column-4\">$55,960 <\/td><td class=\"column-5\">-10.1%<\/td><td class=\"column-6\">142.7%<\/td><td class=\"column-7\">24.6 ppts<\/td><td class=\"column-8\">$433,160 <\/td><td class=\"column-9\">$1,399 <\/td>\n<\/tr>\n<tr class=\"row-4\">\n\t<td class=\"column-1\">Baltimore-Columbia-Towson, MD\u00a0<\/td><td class=\"column-2\">$104,769 <\/td><td class=\"column-3\">5.9%<\/td><td class=\"column-4\">$63,960 <\/td><td class=\"column-5\">9.1%<\/td><td class=\"column-6\">63.8%<\/td><td class=\"column-7\">-5.0 ppts<\/td><td class=\"column-8\">$370,209<\/td><td class=\"column-9\">$1,599 <\/td>\n<\/tr>\n<tr class=\"row-5\">\n\t<td class=\"column-1\">Boston-Cambridge-Newton, MA-NH\u00a0<\/td><td class=\"column-2\">$197,861 <\/td><td class=\"column-3\">7.9%<\/td><td class=\"column-4\">$108,600 <\/td><td class=\"column-5\">6.1%<\/td><td class=\"column-6\">82.2%<\/td><td class=\"column-7\">3.1 ppts<\/td><td class=\"column-8\">$699,400 <\/td><td class=\"column-9\">$2,715 <\/td>\n<\/tr>\n<tr class=\"row-6\">\n\t<td class=\"column-1\">Buffalo-Cheektowaga, NY\u00a0<\/td><td class=\"column-2\">$76,870 <\/td><td class=\"column-3\">6.2%<\/td><td class=\"column-4\">$51,800 <\/td><td class=\"column-5\">4.0%<\/td><td class=\"column-6\">48.4%<\/td><td class=\"column-7\">3.1 ppts<\/td><td class=\"column-8\">$243,928 <\/td><td class=\"column-9\">$1,295 <\/td>\n<\/tr>\n<tr class=\"row-7\">\n\t<td class=\"column-1\">Charlotte-Concord-Gastonia, NC-SC\u00a0<\/td><td class=\"column-2\">$105,974 <\/td><td class=\"column-3\">3.8%<\/td><td class=\"column-4\">$59,360 <\/td><td class=\"column-5\">1.0%<\/td><td class=\"column-6\">78.5%<\/td><td class=\"column-7\">5.0 ppts<\/td><td class=\"column-8\">$393,532 <\/td><td class=\"column-9\">$1,484 <\/td>\n<\/tr>\n<tr class=\"row-8\">\n\t<td class=\"column-1\">Cincinnati, OH-KY-IN\u00a0<\/td><td class=\"column-2\">$80,752 <\/td><td class=\"column-3\">8.5%<\/td><td class=\"column-4\">$58,120 <\/td><td class=\"column-5\">15.3%<\/td><td class=\"column-6\">38.9%<\/td><td class=\"column-7\">-8.7 ppts<\/td><td class=\"column-8\">$284,215<\/td><td class=\"column-9\">$1,453 <\/td>\n<\/tr>\n<tr class=\"row-9\">\n\t<td class=\"column-1\">Cleveland-Elyria, OH\u00a0<\/td><td class=\"column-2\">$66,135 <\/td><td class=\"column-3\">11.3%<\/td><td class=\"column-4\">$51,000 <\/td><td class=\"column-5\">9.0%<\/td><td class=\"column-6\">29.7%<\/td><td class=\"column-7\">2.7 ppts<\/td><td class=\"column-8\">$218,951 <\/td><td class=\"column-9\">$1,275 <\/td>\n<\/tr>\n<tr class=\"row-10\">\n\t<td class=\"column-1\">Columbus, OH\u00a0<\/td><td class=\"column-2\">$93,826 <\/td><td class=\"column-3\">4.1%<\/td><td class=\"column-4\">$56,000 <\/td><td class=\"column-5\">2.6%<\/td><td class=\"column-6\">67.5%<\/td><td class=\"column-7\">2.3 ppts<\/td><td class=\"column-8\">$324,038 <\/td><td class=\"column-9\">$1,400 <\/td>\n<\/tr>\n<tr class=\"row-11\">\n\t<td class=\"column-1\">Dallas-Fort Worth-Arlington, TX\u00a0<\/td><td class=\"column-2\">$121,538 <\/td><td class=\"column-3\">2.9%<\/td><td class=\"column-4\">$57,960 <\/td><td class=\"column-5\">-5.8%<\/td><td class=\"column-6\">109.7%<\/td><td class=\"column-7\">17.8 ppts<\/td><td class=\"column-8\">$395,565 <\/td><td class=\"column-9\">$1,449 <\/td>\n<\/tr>\n<tr class=\"row-12\">\n\t<td class=\"column-1\">Denver-Aurora-Lakewood, CO\u00a0<\/td><td class=\"column-2\">$155,717 <\/td><td class=\"column-3\">4.0%<\/td><td class=\"column-4\">$67,200 <\/td><td class=\"column-5\">-1.1%<\/td><td class=\"column-6\">131.7%<\/td><td class=\"column-7\">11.3 ppts<\/td><td class=\"column-8\">$580,719 <\/td><td class=\"column-9\">$1,680 <\/td>\n<\/tr>\n<tr class=\"row-13\">\n\t<td class=\"column-1\">Detroit-Warren-Dearborn, MI\u00a0<\/td><td class=\"column-2\">$70,584 <\/td><td class=\"column-3\">5.0%<\/td><td class=\"column-4\">$54,000 <\/td><td class=\"column-5\">1.9%<\/td><td class=\"column-6\">30.7%<\/td><td class=\"column-7\">3.9 ppts<\/td><td class=\"column-8\">$248,109 <\/td><td class=\"column-9\">$1,350 <\/td>\n<\/tr>\n<tr class=\"row-14\">\n\t<td class=\"column-1\">Houston-The Woodlands-Sugar Land, TX\u00a0<\/td><td class=\"column-2\">$102,915 <\/td><td class=\"column-3\">2.3%<\/td><td class=\"column-4\">$49,400 <\/td><td class=\"column-5\">-2.0%<\/td><td class=\"column-6\">108.3%<\/td><td class=\"column-7\">8.8 ppts<\/td><td class=\"column-8\">$329,645 <\/td><td class=\"column-9\">$1,235 <\/td>\n<\/tr>\n<tr class=\"row-15\">\n\t<td class=\"column-1\">Indianapolis-Carmel-Anderson, IN\u00a0<\/td><td class=\"column-2\">$80,903 <\/td><td class=\"column-3\">3.9%<\/td><td class=\"column-4\">$55,880 <\/td><td class=\"column-5\">3.5%<\/td><td class=\"column-6\">44.8%<\/td><td class=\"column-7\">0.5 ppts<\/td><td class=\"column-8\">$299,675 <\/td><td class=\"column-9\">$1,397 <\/td>\n<\/tr>\n<tr class=\"row-16\">\n\t<td class=\"column-1\">Jacksonville, FL\u00a0<\/td><td class=\"column-2\">$102,717 <\/td><td class=\"column-3\">1.4%<\/td><td class=\"column-4\">$58,120 <\/td><td class=\"column-5\">-6.9%<\/td><td class=\"column-6\">76.7%<\/td><td class=\"column-7\">14.4 ppts<\/td><td class=\"column-8\">$369,550 <\/td><td class=\"column-9\">$1,453 <\/td>\n<\/tr>\n<tr class=\"row-17\">\n\t<td class=\"column-1\">Las Vegas-Henderson-Paradise, NV\u00a0<\/td><td class=\"column-2\">$115,990 <\/td><td class=\"column-3\">4.5%<\/td><td class=\"column-4\">$59,440 <\/td><td class=\"column-5\">2.5%<\/td><td class=\"column-6\">95.1%<\/td><td class=\"column-7\">3.8 ppts<\/td><td class=\"column-8\">$439,301 <\/td><td class=\"column-9\">$1,486 <\/td>\n<\/tr>\n<tr class=\"row-18\">\n\t<td class=\"column-1\">Los Angeles-Long Beach-Anaheim, CA\u00a0<\/td><td class=\"column-2\">$265,481 <\/td><td class=\"column-3\">7.6%<\/td><td class=\"column-4\">$110,000 <\/td><td class=\"column-5\">-1.6%<\/td><td class=\"column-6\">141.3%<\/td><td class=\"column-7\">20.7 ppts<\/td><td class=\"column-8\">$985,041 <\/td><td class=\"column-9\">$2,750 <\/td>\n<\/tr>\n<tr class=\"row-19\">\n\t<td class=\"column-1\">Louisville\/Jefferson County, KY-IN\u00a0<\/td><td class=\"column-2\">$72,529 <\/td><td class=\"column-3\">4.7%<\/td><td class=\"column-4\">$50,640 <\/td><td class=\"column-5\">8.2%<\/td><td class=\"column-6\">43.2%<\/td><td class=\"column-7\">-4.7 ppts<\/td><td class=\"column-8\">$261,882<\/td><td class=\"column-9\">$1,266 <\/td>\n<\/tr>\n<tr class=\"row-20\">\n\t<td class=\"column-1\">Memphis, TN-MS-AR\u00a0<\/td><td class=\"column-2\">$74,353 <\/td><td class=\"column-3\">6.0%<\/td><td class=\"column-4\">$48,760 <\/td><td class=\"column-5\">4.0%<\/td><td class=\"column-6\">52.5%<\/td><td class=\"column-7\">2.9 ppts<\/td><td class=\"column-8\">$276,266 <\/td><td class=\"column-9\">$1,219 <\/td>\n<\/tr>\n<tr class=\"row-21\">\n\t<td class=\"column-1\">Miami-Fort Lauderdale-Pompano Beach, FL\u00a0<\/td><td class=\"column-2\">$151,039 <\/td><td class=\"column-3\">14.3%<\/td><td class=\"column-4\">$96,400 <\/td><td class=\"column-5\">1.5%<\/td><td class=\"column-6\">56.7%<\/td><td class=\"column-7\">17.6 ppts<\/td><td class=\"column-8\">$512,629 <\/td><td class=\"column-9\">$2,410 <\/td>\n<\/tr>\n<tr class=\"row-22\">\n\t<td class=\"column-1\">Minneapolis-St. Paul-Bloomington, MN-WI\u00a0<\/td><td class=\"column-2\">$107,475 <\/td><td class=\"column-3\">6.2%<\/td><td class=\"column-4\">$61,000 <\/td><td class=\"column-5\">-5.9%<\/td><td class=\"column-6\">76.2%<\/td><td class=\"column-7\">20.0 ppts<\/td><td class=\"column-8\">$377,345 <\/td><td class=\"column-9\">$1,525 <\/td>\n<\/tr>\n<tr class=\"row-23\">\n\t<td class=\"column-1\">Nashville-Davidson--Murfreesboro--Franklin, TN\u00a0<\/td><td class=\"column-2\">$120,300 <\/td><td class=\"column-3\">2.6%<\/td><td class=\"column-4\">$61,200 <\/td><td class=\"column-5\">-2.9%<\/td><td class=\"column-6\">96.6%<\/td><td class=\"column-7\">10.5 ppts<\/td><td class=\"column-8\">$459,176 <\/td><td class=\"column-9\">$1,530 <\/td>\n<\/tr>\n<tr class=\"row-24\">\n\t<td class=\"column-1\">New York-Newark-Jersey City, NY-NJ-PA\u00a0<\/td><td class=\"column-2\">$199,708 <\/td><td class=\"column-3\">8.2%<\/td><td class=\"column-4\">$113,440 <\/td><td class=\"column-5\">-4.5%<\/td><td class=\"column-6\">76.0%<\/td><td class=\"column-7\">20.7 ppts<\/td><td class=\"column-8\">$675,322 <\/td><td class=\"column-9\">$2,836 <\/td>\n<\/tr>\n<tr class=\"row-25\">\n\t<td class=\"column-1\">Orlando-Kissimmee-Sanford, FL\u00a0<\/td><td class=\"column-2\">$111,667 <\/td><td class=\"column-3\">2.8%<\/td><td class=\"column-4\">$69,400 <\/td><td class=\"column-5\">-2.1%<\/td><td class=\"column-6\">60.9%<\/td><td class=\"column-7\">7.6 ppts<\/td><td class=\"column-8\">$401,960 <\/td><td class=\"column-9\">$1,735 <\/td>\n<\/tr>\n<tr class=\"row-26\">\n\t<td class=\"column-1\">Philadelphia-Camden-Wilmington, PA-NJ-DE-MD\u00a0<\/td><td class=\"column-2\">$105,417 <\/td><td class=\"column-3\">6.9%<\/td><td class=\"column-4\">$74,800 <\/td><td class=\"column-5\">1.1%<\/td><td class=\"column-6\">40.9%<\/td><td class=\"column-7\">7.7 ppts<\/td><td class=\"column-8\">$358,656 <\/td><td class=\"column-9\">$1,870 <\/td>\n<\/tr>\n<tr class=\"row-27\">\n\t<td class=\"column-1\">Phoenix-Mesa-Chandler, AZ\u00a0<\/td><td class=\"column-2\">$121,886 <\/td><td class=\"column-3\">4.4%<\/td><td class=\"column-4\">$59,000 <\/td><td class=\"column-5\">-1.7%<\/td><td class=\"column-6\">106.6%<\/td><td class=\"column-7\">11.9 ppts<\/td><td class=\"column-8\">$466,509 <\/td><td class=\"column-9\">$1,475 <\/td>\n<\/tr>\n<tr class=\"row-28\">\n\t<td class=\"column-1\">Pittsburgh, PA\u00a0<\/td><td class=\"column-2\">$66,350 <\/td><td class=\"column-3\">9.0%<\/td><td class=\"column-4\">$58,000 <\/td><td class=\"column-5\">1.0%<\/td><td class=\"column-6\">14.4%<\/td><td class=\"column-7\">8.3 ppts<\/td><td class=\"column-8\">$227,762 <\/td><td class=\"column-9\">$1,450 <\/td>\n<\/tr>\n<tr class=\"row-29\">\n\t<td class=\"column-1\">Portland-Vancouver-Hillsboro, OR-WA\u00a0<\/td><td class=\"column-2\">$150,695 <\/td><td class=\"column-3\">3.3%<\/td><td class=\"column-4\">$70,000 <\/td><td class=\"column-5\">-5.2%<\/td><td class=\"column-6\">115.3%<\/td><td class=\"column-7\">17.7 ppts<\/td><td class=\"column-8\">$540,231 <\/td><td class=\"column-9\">$1,750 <\/td>\n<\/tr>\n<tr class=\"row-30\">\n\t<td class=\"column-1\">Providence-Warwick, RI-MA\u00a0<\/td><td class=\"column-2\">$135,648 <\/td><td class=\"column-3\">7.1%<\/td><td class=\"column-4\">$86,060 <\/td><td class=\"column-5\">12.2%<\/td><td class=\"column-6\">57.6%<\/td><td class=\"column-7\">-7.5 ppts<\/td><td class=\"column-8\">$477,895<\/td><td class=\"column-9\">$2,152 <\/td>\n<\/tr>\n<tr class=\"row-31\">\n\t<td class=\"column-1\">Raleigh-Cary, NC\u00a0<\/td><td class=\"column-2\">$118,397 <\/td><td class=\"column-3\">4.1%<\/td><td class=\"column-4\">$56,800 <\/td><td class=\"column-5\">-3.7%<\/td><td class=\"column-6\">108.4%<\/td><td class=\"column-7\">15.7 ppts<\/td><td class=\"column-8\">$433,658 <\/td><td class=\"column-9\">$1,420 <\/td>\n<\/tr>\n<tr class=\"row-32\">\n\t<td class=\"column-1\">Richmond, VA\u00a0<\/td><td class=\"column-2\">$105,530 <\/td><td class=\"column-3\">6.0%<\/td><td class=\"column-4\">$62,720 <\/td><td class=\"column-5\">1.2%<\/td><td class=\"column-6\">68.3%<\/td><td class=\"column-7\">7.6 ppts<\/td><td class=\"column-8\">$389,990 <\/td><td class=\"column-9\">$1,568 <\/td>\n<\/tr>\n<tr class=\"row-33\">\n\t<td class=\"column-1\">Riverside-San Bernardino-Ontario, CA\u00a0<\/td><td class=\"column-2\">$161,182 <\/td><td class=\"column-3\">6.6%<\/td><td class=\"column-4\">$93,000 <\/td><td class=\"column-5\">1.2%<\/td><td class=\"column-6\">73.3%<\/td><td class=\"column-7\">8.8 ppts<\/td><td class=\"column-8\">$588,006 <\/td><td class=\"column-9\">$2,325 <\/td>\n<\/tr>\n<tr class=\"row-34\">\n\t<td class=\"column-1\">Sacramento-Roseville-Folsom, CA\u00a0<\/td><td class=\"column-2\">$158,682 <\/td><td class=\"column-3\">3.7%<\/td><td class=\"column-4\">$80,160 <\/td><td class=\"column-5\">4.4%<\/td><td class=\"column-6\">98.0%<\/td><td class=\"column-7\">-1.3 ppts<\/td><td class=\"column-8\">$576,111<\/td><td class=\"column-9\">$2,004 <\/td>\n<\/tr>\n<tr class=\"row-35\">\n\t<td class=\"column-1\">St. Louis, MO-IL\u00a0<\/td><td class=\"column-2\">$72,094 <\/td><td class=\"column-3\">8.3%<\/td><td class=\"column-4\">$50,120 <\/td><td class=\"column-5\">-2.9%<\/td><td class=\"column-6\">43.8%<\/td><td class=\"column-7\">14.8 ppts<\/td><td class=\"column-8\">$253,926 <\/td><td class=\"column-9\">$1,253 <\/td>\n<\/tr>\n<tr class=\"row-36\">\n\t<td class=\"column-1\">Salt Lake City, UT\u00a0<\/td><td class=\"column-2\">$140,412 <\/td><td class=\"column-3\">4.7%<\/td><td class=\"column-4\">$59,960 <\/td><td class=\"column-5\">-7.8%<\/td><td class=\"column-6\">134.2%<\/td><td class=\"column-7\">28.0 ppts<\/td><td class=\"column-8\">$525,667 <\/td><td class=\"column-9\">$1,499 <\/td>\n<\/tr>\n<tr class=\"row-37\">\n\t<td class=\"column-1\">San Diego-Chula Vista-Carlsbad, CA\u00a0<\/td><td class=\"column-2\">$241,218 <\/td><td class=\"column-3\">4.3%<\/td><td class=\"column-4\">$106,200 <\/td><td class=\"column-5\">-5.7%<\/td><td class=\"column-6\">127.1%<\/td><td class=\"column-7\">21.7 ppts<\/td><td class=\"column-8\">$889,688 <\/td><td class=\"column-9\">$2,655 <\/td>\n<\/tr>\n<tr class=\"row-38\">\n\t<td class=\"column-1\">San Francisco-Oakland-Berkeley, CA\u00a0<\/td><td class=\"column-2\">$296,984 <\/td><td class=\"column-3\">3.8%<\/td><td class=\"column-4\">$107,720 <\/td><td class=\"column-5\">-2.1%<\/td><td class=\"column-6\">175.7%<\/td><td class=\"column-7\">15.6 ppts<\/td><td class=\"column-8\">$1,080,775 <\/td><td class=\"column-9\">$2,693 <\/td>\n<\/tr>\n<tr class=\"row-39\">\n\t<td class=\"column-1\">San Jose-Sunnyvale-Santa Clara, CA\u00a0<\/td><td class=\"column-2\">$408,557 <\/td><td class=\"column-3\">8.2%<\/td><td class=\"column-4\">$128,580 <\/td><td class=\"column-5\">2.6%<\/td><td class=\"column-6\">217.7%<\/td><td class=\"column-7\">16.6 ppts<\/td><td class=\"column-8\">$1,514,289 <\/td><td class=\"column-9\">$3,215 <\/td>\n<\/tr>\n<tr class=\"row-40\">\n\t<td class=\"column-1\">Seattle-Tacoma-Bellevue, WA\u00a0<\/td><td class=\"column-2\">$202,909 <\/td><td class=\"column-3\">3.3%<\/td><td class=\"column-4\">$82,680 <\/td><td class=\"column-5\">1.5%<\/td><td class=\"column-6\">145.4%<\/td><td class=\"column-7\">4.3 ppts<\/td><td class=\"column-8\">$731,529 <\/td><td class=\"column-9\">$2,067 <\/td>\n<\/tr>\n<tr class=\"row-41\">\n\t<td class=\"column-1\">Tampa-St. Petersburg-Clearwater, FL\u00a0<\/td><td class=\"column-2\">$102,414 <\/td><td class=\"column-3\">0.0%<\/td><td class=\"column-4\">$71,000 <\/td><td class=\"column-5\">-0.3%<\/td><td class=\"column-6\">44.2%<\/td><td class=\"column-7\">0.5 ppts<\/td><td class=\"column-8\">$365,936 <\/td><td class=\"column-9\">$1,775 <\/td>\n<\/tr>\n<tr class=\"row-42\">\n\t<td class=\"column-1\">Virginia Beach-Norfolk-Newport News, VA-NC\u00a0<\/td><td class=\"column-2\">$97,184 <\/td><td class=\"column-3\">8.3%<\/td><td class=\"column-4\">$62,000 <\/td><td class=\"column-5\">8.1%<\/td><td class=\"column-6\">56.7%<\/td><td class=\"column-7\">0.3 ppts<\/td><td class=\"column-8\">$350,296 <\/td><td class=\"column-9\">$1,550 <\/td>\n<\/tr>\n<tr class=\"row-43\">\n\t<td class=\"column-1\">Washington-Arlington-Alexandria, DC-VA-MD-WV\u00a0<\/td><td class=\"column-2\">$153,261 <\/td><td class=\"column-3\">5.0%<\/td><td class=\"column-4\">$81,520 <\/td><td class=\"column-5\">8.1%<\/td><td class=\"column-6\">88.0%<\/td><td class=\"column-7\">-5.7 ppts<\/td><td class=\"column-8\">$545,950<\/td><td class=\"column-9\">$2,038 <\/td>\n<\/tr>\n<tr class=\"row-44\">\n\t<td class=\"column-1\"><strong>United States of America<\/strong><\/td><td class=\"column-2\"><strong>$116,633 <\/strong><\/td><td class=\"column-3\"><strong>5.3%<\/strong><\/td><td class=\"column-4\"><strong>$64,160 <\/strong><\/td><td class=\"column-5\"><strong>0.2%<\/strong><\/td><td class=\"column-6\"><strong>81.8%<\/strong><\/td><td class=\"column-7\"><strong>8.6 ppts<\/strong><\/td><td class=\"column-8\"><strong>$423,892 <\/strong><\/td><td class=\"column-9\"><strong>$1,604 <\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<!-- #tablepress-448 from cache -->\n<h3><b>Methodology<\/b><b><br \/>\n<\/b><\/h3>\n<p><span style=\"font-weight: 400;\"><br \/>\nWe consider a home affordable if a buyer spends no more than 30% of their income on their housing payment. We use the same threshold for rental affordability. The buy-to-rent premium is defined as the ratio of income needed to afford a typical home to the income needed to afford a typical apartment. In this report, the word \u201chomebuyer\u201d refers to someone who is taking out a loan to finance their purchase.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The income needed to afford the typical home is calculated using the prevailing median home sale price and average mortgage-interest rate over rolling three-month periods, and assumes a 15% down payment. The typical housing payments noted in this report include the mortgage principal, interest, property taxes, homeowners\u2019 insurance and mortgage insurance. The 2025 median household income is estimated using the U.S. Census Bureau\u2019s (ACS) 2023 median household income and 12-month moving average nominal wage growth rates compiled from the Current Population Survey and reported by the Federal Reserve Bank of Atlanta.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The income needed to afford the typical apartment is calculated using the prevailing median asking rent over rolling three-month periods. Median asking rent figures cover newly listed units in apartment buildings with five or more units. Asking rents reflect the current costs of new leases during each time period. In other words, the amount shown as the median asking rent is not the median of what all renters are paying, but the median asking price of apartments that were available for new renters during the report period.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Americans need an annual income of $117,000 to afford the typical home for sale. That&#8217;s 82% more than they need for the typical rental, up from 73% more last year. The gap is widening because home prices are rising faster than rents. The gap is widening most in Salt Lake City and Austin, and shrinking [&hellip;]<\/p>\n","protected":false},"author":13346,"featured_media":79483,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"default","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[27,8,563],"tags":[20,697,88],"dashboard":[],"coauthors":[125,660],"class_list":["post-79575","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-affordability","category-housing-market-news","category-rental-market","tag-housing-affordability","tag-rentals","tag-renting"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.7 (Yoast SEO v27.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Homebuyers Need to Earn Over $50,000 More Than Renters<\/title>\n<meta name=\"description\" content=\"Americans need to earn $117,000 to afford the typical home. That&#039;s 82% more than they need for the typical rental, up from 73% more last year.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.redfin.com\/news\/rent-vs-buy-income-gap-2025\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Homebuyers Need to Earn Over $50,000 More Than Renters to Afford Monthly Payments\u2014And the Gap Is Widening\" \/>\n<meta property=\"og:description\" content=\"Americans need to earn $117,000 to afford the typical home. 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