Currently Reading

Mortgages Remain Within Affordable Levels Despite Rising Prices

Market Data + Trends

Mortgages Remain Within Affordable Levels Despite Rising Prices

September 17, 2021
paying mortgage
Photo: Prostock-studio |

Though home prices continue up, today’s homebuyers are not overextending themselves financially, unlike they did during the Great Recession. A recent report found buyers put down 21% of their household income before taxes toward monthly mortgage payments in May. It’s higher than the previous 19.6% share of income over the past decade, but remains within the affordable range. The affordability zone for housing is anything less than 30% of the buyer's income.’s economist says the affordable mortgage payments result from low interest rates. In August 2008, buyers put 25.3% of their income toward housing payments.

Buyers were in trouble in August 2008, when 25.3% of their income respectively went toward their housing payments. There was also a rise in June 2018, when about 22.4% of earnings was used for a mortgage. While the sales data hasn’t been formalized yet, July of this year looks to be about the same percentage as in 2018 when factoring in home list prices and mortgage rates.

Today’s buyers are in better financial shape than in 2008

That’s not a reason to panic.

“Compared to the Great Recession, buyers today tend to have higher incomes, which makes the share of what they’re spending on housing payments lower than it was in 2008,” says Xu.

Before the Great Recession, just about anyone could get a mortgage. Borrowers could lie about how much they earned—and many did. Since the housing bust, only the most qualified folks are getting mortgages, and it’s become even more difficult to score a loan during the COVID-19 pandemic. That means today’s buyers make more money, have higher credit scores, and are generally in good financial shape. So another foreclosure crisis is unlikely—despite the record-high home prices.

Read More

Related Stories

Built for Rent

Single-Family Rentals Are Taking Over the Housing Market

For some, single-family rentals are taking precedence over homeownership.

Market Data + Trends

September Reports Increased Home Sales

Monthly home sales rebounded in September after August decline.


More in Category


Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.

Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.