Despite More Listings, 77% of Homes Are Still Out of Reach for Middle-Income Earners

There are more homes for sale than there were at the worst point of the post-pandemic shortage and price growth has slowed. But despite these headline improvements, the market remains sluggish—a new analysis helps explain why.

The problem, according to The Housing Mismatch report from Realtor.com® and the National Association of Realtors®, is that the recovery is not reaching the people most likely to restart the market.

Buyers earning about $75,000 can afford only 23% of active listings nationwide. In a balanced market, they would be able to access about 44%. That gap equals roughly 311,000 missing listings priced below their max purchase point estimated at $261,000, according to the report.

Even those earning $100,000 can afford only 39% of listings today, compared with 56% in balanced conditions—representing a shortage of 257,000 listings.

But it’s not all bad news, according to Nadia Evangelou, NAR principal economist and director of real estate research.

“Housing supply is growing and affordability is improving,” she says. Nearly all major markets showed improvement over the past year, with 99 of the 100 largest metros recording gains or remaining flat.

“However, the U.S. housing market continues to face a structural mismatch between the homes available for sale and what buyers can afford,” Evangelou adds. “Too much of the inventory available today remains concentrated at higher price points, leaving a shortage of options for entry-level and middle-income buyers.”

It’s that mismatch that helps explain why home sales have not returned to pre-pandemic levels—and that may be the most important takeaway for policymakers searching for solutions to America’s affordability problem.

A new way to measure the market

The report introduces the Listing-Income Alignment Score, a new metric that offers an important reframe from how affordability is often discussed.

Inventory data can show whether more homes are coming onto the market. Affordability measures can show whether buyers have gained or lost purchasing power. But neither fully answers the question that guides most buyers: What are my options?

Now, the Listing-Income Alignment Score does, by measuring how well the distribution of home listings in a given market matches the income distribution of local households. A score of 100% means listings are distributed proportionally across income levels, while a lower score means the available listings don’t match what local buyers can afford.

Nationally, the score reached 74.9% in March 2026, up from 66.7% a year earlier, but still below the 84.4% pre-pandemic baseline. Locally, though, conditions vary significantly.

Among the 100 largest metro areas, only seven are now considered well aligned—a significant improvement from 2025, when only one metro met that threshold. But it’s still far below 2019, when 20 metros did.

The best-aligned markets are concentrated in the Midwest and Upper South. Toledo, St. Louis, Akron, Pittsburgh, and Detroit all exceed the 100% threshold, meaning the homes available for sale more closely match what local households can afford.

At the other end are the 11 major metros that remain in severe shortage, with alignment scores below 60%. They include Los Angeles, San Diego, Oxnard, Providence, and Boise. It’s an improvement from 2025, when 33 metros fell into severe shortage, but still worse than 2019, when only seven did.

Why a mismatch in listings and incomes keeps home sales stuck

That snapshot helps explain why home sales have remained below their pre-pandemic totals—only 4.06 million homes sold in 2025, compared with 5.34 million in 2019, for perspective.

“The data makes clear that more inventory alone won’t be enough to unlock the housing market,” explains Danielle Hale, chief economist at Realtor.com. “A true recovery requires homes at the right price points.”

It all comes down to optionality—and the journey of a middle-income buyer through some of the country’s largest metros shows why.

In Los Angeles, the most misaligned market in the report, a household earning $75,000 per year can afford only 0.9% of listings, compared with 37.8% in a balanced market. Even households earning $100,000 can afford only 4.1% of listings.

In a market like that, more listings don’t necessarily translate into more sales. If new supply lands mostly above what middle-income buyers can afford, it won't meaningfully expand the pool of people who can transact.

This mismatch is clearly at play in Los Angeles—with only buyers making $500,000 or more per year able to access the total share of listings that they should be able to in a balanced market. It offers a glimpse into why homes may be technically available, but they're still remaining functionally unavailable to the buyers who would normally kickstart the market.

In Toledo, though, our middle-income buyers fare much better. A household with $75,000 per year has the optionality to afford 59.7% of listings and at $100,000 a year, 71.6% of listings. Even high earning households maintain access to a balanced share of listings.

This isn’t to suggest that Toledo is immune to other headwinds in the market, like elevated mortgage rates or border economic uncertainty, but it does show how real options for buyers create real movement in sales. The Midwest and the South (the regions with the best listing-income alignment) posted the largest year-over-year gains in pending homes sales, according to the most recent data from NAR.

As Hale puts it, “Until the supply of entry-level and middle-market homes grows to meet demand, many buyers will continue to find the market out of reach despite headline improvements in affordability and inventory."

The housing recovery has to reach the middle

But the mismatch could have much wider reaching consequences than just a short-term drag on sales.

Previous Realtor.com research has found that entering the housing market early pays dividends over a lifetime. Buying a first home by age 30 is associated with 22.5% higher net worth by age 50, or about $119,000 more for a typical midlife household, compared with buying in one’s 40s.

That advantage can carry into the next generation, too. Children raised in homeowner households are 18.4 percentage points more likely to become homeowners by age 35.

If today’s shortage of affordable listings continues to price out middle- and moderate-income buyers, it can shorten the window households have to build equity and accumulate the kind of housing wealth that often helps the next generation enter the housing market in that critical window.

The report is clear that more supply alone will not restore normal market activity if that supply remains out of step with local incomes. The market needs more entry-level and middle-market homes, especially in metros where low alignment scores show that listings are badly mismatched with what local households can afford.

Until it does, more listings may keep showing up without turning into more sales—and more households who are ready to buy may keep losing the one thing homeownership rewards most: time.