(The Epoch Times)—Stealers Wheel’s 1973 hit “Stuck in the Middle with You” could well become the theme song for today’s middle-income, first-time home buyers who don’t qualify for affordable housing programs yet cannot afford market-rate homes.

The household income required to purchase a starter home, currently priced under $350,000 in the United States, has surged more than 80 percent to $78,000 from $43,000 in 2019, according to a July 20 report from Realtor.com.

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By contrast, the median household income was $83,730 in 2024, representing an increase of under 22 percent from $68,703 in 2019, according to the latest Census Bureau estimates.

This gap in growth between home prices and household incomes has made it increasingly difficult for even middle-income households to own a home, real estate professionals, economists, and recent research say.

Caught in the Middle

Vlora Sejdi, an associate broker with HomeSmart in White Plains, New York, recently told The Epoch Times about the challenges her young clients face in buying a home.

She is currently working with a childless couple under 40 who are living with parents while saving for a down payment on a home in Westchester County, an affluent suburb north of New York City, which had a median home price of $867,398 in May, according to Redfin.

“Home prices here just keep going up and up,” she said. “It’s a seller’s market and people who can afford to buy are willing to go above and beyond. We’re still seeing bidding wars.”

“They’re very unhappy with the current situation, and I think there’s also a shock factor for what their monthly payments will be with mortgage, taxes, and insurance,” she said.

Sejdi said another of her clients, a woman in her 20s, also from Westchester County, is currently renting while searching for a co-op, a type of housing in which residents purchase shares in a cooperative corporation that owns the building, rather than own individual units, according to Apartments.com.

Co-ops tend to be much less expensive than condos or single-family homes. According to OneKey MLS, in Westchester County, the median sales price for co-ops was $223,750 in May, compared with $576,500 and $1,200,000 for condos and single-family homes, respectively.

However, these properties are controlled by a co-op board of directors that can set stringent financial requirements for anyone seeking to purchase an apartment.

“My client actually had one accepted offer, but the board would not approve her, despite the fact that she now pays significantly more in monthly rent than she would for monthly maintenance at the co-op,” Sejdi said.

Sejdi will continue to search for other possibilities but admits the journey has been challenging for both of them.

“There’s definitely a lack of attainable housing for the middle class in Westchester,” she said. “These are people who make too much money to qualify for affordable housing, but don’t have enough to afford market-rate homes.”

Sejdi’s clients requested anonymity.

The Pew Research Center classifies households earning between 67 percent and 200 percent of the overall median household income, adjusted for household size, as “middle-income” households.

Based on the Census Bureau median of $83,730, this means those households had annual incomes of between $56,100 and $167,460.

In Westchester County, the median household income was $118,596 in 2024.

According to Westchester County government documents, the county’s affordable housing programs include developments for households earning up to 120 percent of the area median income (AMI), though the income limits vary by development.

The current 120 percent AMI income limits for one-person and two-person households in the county are $162,800 and $142,450, respectively.

The situation is not limited to high-priced markets like New York. Middle-income, First-time buyers in more affordable areas, such as Texas, also face affordability challenges.

“North Texas is still considerably more attainable than markets like New York or California, but affordability has become one of the biggest challenges facing first-time buyers here as well,” Johnny Mowad, associate broker with Ebby Halliday Realtors in Dallas, told The Epoch Times.

At the end of May, Redfin reported that the median sales price was $498,702 in Dallas and $337,798 in Fort Worth.

As in many other parts of the country, Mowad noted that wages have not kept pace with housing costs, and the demand in Northern Texas remains high as more people relocate to the area.

“That puts more pressure on inventory,” he added.

Housing Mismatch

A joint May report by NAR and Realtor.com indicates that the much-needed housing recovery is not reaching the people who are most likely to restart the market.

“Buyers earning about $75,000 can afford only 23 percent of active listings nationwide,” the report states. In a balanced market, they would be able to access about 44 percent.

The report notes that the gap represents about 311,000 missing listings priced below their maximum purchase point, which is estimated at $261,000.

“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,” Nadia Evangelou, NAR principal economist, said in the report.

According to a June 24 Pew Research Center survey, 89 percent of America’s adults younger than 40 said it’s harder for them to own a home than for their parents’ generation.

The report attributes the perception primarily to rising housing costs and a challenging job market, which have made homeownership feel out of reach for many young adults.

The Harvard Joint Center’s June 17 State of the Nation’s Housing report states that, with a nationwide median price of about $417,400 for new single-family homes in 2025, most new housing was unaffordable for median-income households based on the standard affordability threshold of 30 percent of income.

Existing homes were less attainable. With the median price rising 54 percent since 2020 to $419,300, according to the National Association of Realtors (NAR), a typical single-family home sold at five times the median household income in 2025, the Harvard report notes.

By contrast, the report said the average price-to-income ratio was 3.2 in the 1990s.

The median existing home price rose further to $440,600 in June, reaching an all-time high, the NAR said on July 9.

Using first-quarter data, a May 12 analysis by HSH Associates, a private mortgage and housing finance information company, found that U.S. households needed an annual income of $103,419 to afford a median-priced home.

The calculation assumed buyers obtained a 30-year fixed-rate mortgage with a 20 percent down payment, while taking into account principal, interest, property tax, and insurance payments.

Of the 50 largest metropolitan areas analyzed, only 12 had required incomes below the national average for buying a median-priced home, the report shows.

For high-priced markets such as San Jose, California, and New York City, the required incomes were $477,409 and $197,521, respectively.

The median home prices of these cities were $2,030,000 and $750,000, respectively.

In Dallas, households needed $105,798 to afford a median-priced home, according to the HSH Associates report.

Millions of Adults Living at Home

With housing costs and a challenging job market, the Harvard report says, “Many young adults cannot afford to form new households, instead doubling up or living with family.”

The report shows that household growth, a primary driver of housing demand, slowed for the third straight year to 1.1 million in 2025, down from an average annual growth of 2.0 million in 2020 and 2021.

A mid-June report from Realtor.com indicates that one in three adults under the age of 35—about 25.2 million people—lived with their parents in 2025, as they were priced out of the housing market.

“The adults living with their parents today are largely employed, and many hold college degrees. What’s holding them back isn’t a lack of qualifications, but rather, at least in part, a lack of housing they can actually afford,” Realtor.com senior economist Hannah Jones said in the report.

The data show that about nine in 10 adults aged 25 to 34 living with parents have never been married and about one in three aged 25 to 29 hold a four-year college degree.

Men comprise the majority of this group at every age level.

Meanwhile, according to a June 25 report from the Census Bureau, the nation’s fertility rates have dropped almost every year since 2007, although they have risen in certain counties throughout the country.

The Year of ‘Starter Homes’

Robert Dietz, chief economist at the National Association of Home Builders (NAHB), recently told Siyamak Khorrami, the host of EpochTV’s “Market Insider,” that a decade and a half of underbuilding, especially of entry-level housing, is a key factor contributing to the housing affordability issue Americans are facing.

While Realtor.com estimated in March that the United States was short by about 4.03 million homes in 2025, NAHB put the number at about 1 million using different methodology.

Dietz said the current housing shortage suggests pent-up demand is building among young homebuyers—there are just not enough homes on the market that fit their budgets.

“One really interesting data point that we track is the number of young adults who live with their parents. Right now, one out of five of those 25- to 34-year-olds live with their parents. Back 20 years ago it was one out of 10, so that share has doubled,” he said, citing a May NAHB analysis.

A northern California-based developer, Chris Duffy, founder and CEO of Hummingbird Development, agrees that the nation needs more entry-level housing, but providing that is very difficult due to rising construction costs.

“The cost of construction has gone up so much over the past 20 years,” he told The Epoch Times. “With land, materials, labor, permits, architect costs, and other regulatory fees, the economics of building less expensive homes just doesn’t work.

“Most new developments have to go with luxury housing to make a profit.”

Duffy noted that depending on where they decide to build, it can take years to jump through all of the local government regulations.

In the organization’s July 9 report, NAR chief economist Lawrence Yun warned that home prices could accelerate if housing inventory continues to stagnate.

The solution, noted Dietz, is to build more housing of all types, including single-family and multifamily for both sale and rent. He noted that construction of more multifamily options can help builders adapt to the challenges of creating more affordable homes.

“For example, we’ve seen a big rise in townhouse construction,” he said. “These are homes that are connected; they require less land.”

In its June 30 Housing Market Indicators report, the American Enterprise Institute called 2026 “the Year of ‘Starter Homes’ and ‘Small Lot, Small Lot, Small Lot.’”

The institute said 188 housing bills had been introduced so far this year, including 26 pending, enacted, or passed bills in 15 states that align with the AEI Housing Center Playbook.

The Playbook outlines policy recommendations to increase the supply of naturally affordable housing.

AEI projects that enacted, passed, and pending bills aligned with the Playbook’s three policy options—smaller lots for new homes, greater flexibility on existing residential lots, and more housing near jobs and amenities—could add about 281,000 homes annually.

Because land prices are more affordable in the Sun Belt and Midwest, Dietz said new home construction has experienced growth in those areas.

Demand for lower-entry-home price points continues to be strong throughout the nation, he said.

Mowad said while home purchasing remains challenging for younger buyers, starter homes do come up in the market, though they may not represent someone’s dream home.

He noted that younger, middle-income buyers who are determined to make a purchase may start with a condo or townhome.

“While affordability has certainly tightened over the last several years, I’d much rather be a first-time buyer in Dallas than in many coastal markets,” he said.

“In many parts of the Northeast, buyers are competing against housing costs that simply don’t align with middle-income salaries.”

Mowad said the region has been attracting many new residents due to a lower cost of living relative to other major metropolitan areas, a large concentration of Fortune 500 company headquarters, and no state income tax.

“People aren’t just moving here for cheaper homes; they’re moving here for careers and long-term opportunities,” he said.

Meanwhile, Sejdi is serving on the newly created Westchester County Board of Legislators’ Affordability and Economic Development Task Force that will address how to bring more affordable and middle-income housing into one of America’s most expensive areas.

“We are hopeful that together we can develop some solutions that will help people in the lower and middle-income brackets be able to afford to make their homes here,” she said.