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The Gap Between Renters and Home Ownership Affordability
It shouldn’t be a surprise to anyone that homeowner affordability continues to decline. The National Association of Realtors has acknowledged this. So has the Joint Center for Housing Studies of Harvard University.
Now, CBRE has thrown its own figures into the mix. In a report, “Fewer Renter Households Can Afford Homeownership,” the authors said that 1.8 million renter households can’t afford median-priced homes in their markets. The reasons? “Persistently high mortgage rates and sharply higher home prices,” according to the report.
CBRE tracked 69 markets for its results, pointing out that Boston and Washington, DC, have the majority of renter households that can’t afford a median-priced home. Also tops on the list are Sunbelt markets that experienced COVID in-migration.
CBRE also noted that an increased premium to make a monthly mortgage payment versus an average market rent has led to a drop in affordability. Analysts explained that Orange County’s premium was 303% in Q2 2025 versus 160% in 2019. “Buying premiums in Austin and Los Angeles also increased significantly, while some markets (e.g., San Francisco and Chicago) changed very little from 2019,” the analysts added.
This can be good news for the multifamily sector, with CBRE forecasting that occupancy rates will continue to be higher than historical averages over the long term, while “putting upward pressure on near-term rent growth as multifamily supply and demand rebalances.”
- ◦Sale/Acquisition
- ◦Financing
- ◦Economy
