Home values have risen much faster than the incomes of the people living in them. From 2000 to 2024, median per-capita income has grown steadily but modestly, at around 155% in nominal terms. Over the same period, median home prices—when measured carefully and adjusted for local composition—have increased at a much faster pace, at around 207% in nominal terms. … For first-time homebuyers, the bar for homeownership is now substantially higher, and this is why the average age to purchase a first house has increased around 10 years. For existing owners, housing has become an increasingly central store of wealth. Any serious discussion of housing policy, local land-use reform, or the distributional effects of monetary and credit policy should consider this basic fact: In much of the United States, the typical home has simply outrun the typical paycheck.
When you tell everyone a home is the best investment instead of just a place to live.. the is an outcome. No policy changes survive the ‘but my investment’ argument.
Quote Citation: Manu Garcia , Carlos Garriga, “The Lost Decades of Housing Affordability | St. Louis Fed”, February 12, 2026, https://www.stlouisfed.org/on-the-economy/2026/feb/when-houses-outrun-paychecks-lost-decades-housing-affordability