When people talk about housing affordability, the conversation usually starts — and ends — with mortgage rates. But the reality in 2026 is more nuanced. While interest rates play a role, home prices often have an even bigger impact on whether a home feels affordable.
According to a 2025 Zillow report, mortgage rates would need to drop more than 4% from today’s average of around 6.11% for the typical home to become fully affordable for a median-income family nationwide. That’s a significant shift — and it highlights how affordability challenges go beyond just rate movements.
Local Markets Tell a Very Different Story
One of the biggest misconceptions about affordability is that it’s the same everywhere. In truth, housing markets vary dramatically from city to city.
In higher-cost markets like Boston, Seattle, New York, Los Angeles, and Miami, home prices have risen so much that even extremely low mortgage rates wouldn’t make the average home affordable for many buyers.
Meanwhile, in more affordable markets — such as Pittsburgh, Birmingham, or Detroit — lower home prices help keep monthly payments within reach, even when mortgage rates are higher. For example, Zillow reports average home values around:
- Pittsburgh: approximately $231,000
- Birmingham: approximately $133,000
- Detroit: approximately $76,000
These differences show why affordability is highly local — and why national headlines don’t always reflect your personal buying power.
Why Home Price Often Matters More Than Rate
Mortgage rates can change quickly, but home prices shape the foundation of your monthly payment. A slightly higher rate on a moderately priced home can sometimes be more manageable than a low rate on a very expensive property.
That’s why smart homebuyers look at the full picture:
- Home price
- Monthly payment
- Loan structure
- Long-term financial goals
Instead of waiting for the “perfect” rate, many buyers focus on finding a home that fits their budget today — with the option to refinance later if market conditions improve.
The Bottom Line
Your mortgage rate matters — but home price often matters more when it comes to true affordability. Understanding how both factors work together is the key to making a confident decision.
If you want clarity on what you can realistically afford in your local market, we’re here to help you explore your options and build a strategy that fits your goals.