This Homeownership Month was met with limited fanfare. Ask anyone looking to purchase a home these days and the outlook is bleak. The balancing act of household budgets seems more precarious than ever. Existing pressures of inflation and lagging income gains have been compounded by geopolitical conflict that feels far away from housing policy. But economics do not exist in a vacuum. It looks as if we have a sinking ship in the American Dream. But rising tides lift all boats, and there are some rising tides on the horizon. The 21st Century ROAD to Housing Act (ROAD) is one of those rising tides – a big one. NHC has been vocally and enthusiastically supportive of the legislation throughout its many iterations, and looks forward to it being signed into law by the President following overwhelmingly bipartisan action by the House and Senate. The impact of this legislation will take some time to sink in, but it will certainly come as programs are updated, red tape streamlined, and more homebuilding moves forward in earnest.
Let’s take a closer look at the economic factors that have contributed to such broad, bipartisan consensus on the need for this legislation. Housing has long been especially sensitive to broader economic forces. We have seen it repeatedly in recent years: when lumber costs surged during the pandemic supply chain disruption, when bidding wars began as student loan payment pauses allowed households to suddenly save for down payments, in ongoing discourse of elevator shortages, and recently as labor markets coped with changes in immigration policy.
For consumers, the downstream impacts are staggering. Inflation translates to higher utility bills, property taxes, and insurance costs. It is not uncommon for housers to proclaim that today’s 30-year fixed-rate mortgage is looking more like an adjustable-rate mortgage in its monthly variances. The new economic reality is one where mortgage costs are less predictable. For an increasing number of households, taxes and insurance are overtaking principal and interest as the most expensive part of a monthly mortgage. In its March 2025 Mortgage Monitor, ICE Mortgage Technology reported that the average annual property insurance premium for single-family homes rose by $276 in 2024, a record. Comparatively, premiums increased by $15 in 2017, $56 in 2020, and $184 in 2022. In its September report, it was noted that property insurance costs surged by 70% in the last five years, compared to increases of 23% for principal and 27% for both interest and property taxes. By March 2026, the pace of growth had slowed, but the average monthly property insurance premium had reached $201, compared to $165 in 2023 and $112 in 2018.
Property taxes also rose by over 27% since 2019. Cotality reported in 2025 that property tax delinquencies rose by 5.1%, a slight uptick from previous years and a leading risk indicator for households that may be in trouble. The delinquency rate was highest in 2012 at 8.2% and lowest in 2019 at 4.4%. Some states saw drastic increases in property taxes during the same five years—Colorado taxes rose by nearly 53%, Georgia by 52%, and Florida by 48%.
And utilities, the clearest conduit to larger economic shifts, rose throughout 2025 as well. Electricity costs increased 6.3%, natural gas by 9.8%, and water and sewer by 5.1%.
Consequently, the total monthly cost of a median-priced home is $3,120, according to the Harvard Joint Center for Housing Studies latest State of the Nation’s Housing report. NHC’s own Paycheck to Paycheck database shows that in June 2025, of the nearly 90,000 data combinations of metropolitan statistical areas (MSA) and occupations, only 14% of occupations could afford to purchase a typically priced home in their respective MSA with a 10% down payment. With 3% down, only 12% could afford a home. In 2020, 39% of those combinations could afford to purchase a home with 10% down, and 35% could purchase with 3% down.
For those looking for a more affordable starter home, condominiums can be a stepping stone into homeownership – but condo fees can quickly make even those options unaffordable each month. Condo fees, as well as homeowners association fees, are simultaneously growing across communities. Median condo fees were reported at $420 in 2025, up from $337 in 2020. At least 15% of households paying such fees are now shelling out $500 or more a month, money that does not build equity but can be worthwhile depending on services covered by the fee structure.
Nothing has been left untouched by inflation. The prospect of homebuying – the economy itself – feels like compounding interest.
Affordability concerns do not end at settlement any more than mortgage payments do. Homebuyers are left feeling the pricing squeeze in all aspects of homeownership through additional upfront costs that often include completing a home inspection, booking a moving company, scheduling a locksmith, hiring a painter, ordering appliances, stocking up on tools, and selecting furniture.
And it bears noting that when people are considering whether to buy or rent, losing the small moments like picking out paint colors and buying a table that maybe isn’t made of particle board are what make the process personal. If a person cannot afford to make a home out of the house they buy, the benefits of homeownership are diminished. Envisioning a future with savings and expendable income for those moments is part of the American Dream of homeownership.
Beyond having control over their space, homeowners must also contend with unplanned maintenance costs and the potential for emergency repairs. A burst pipe or fallen tree brings reality back into the dream very quickly (ask any homeowner about carpenter bees), and the first year of homeownership is documented to be the most financially vulnerable for new homeowners. Most households have depleted their savings in order to make a down payment, among the other mentioned upfront costs. A setback in year one, when a new owner has made what is likely the largest investment of their life, is challenging at best and devastating at worst.
As potential buyers make choices between loans, it is entirely possible that they make the decision to deplete more of their savings towards a larger down payment in order to lower their monthly mortgage. This leaves households more vulnerable to sudden maintenance costs. More affordable homes are also more likely to be older, and inevitably will need some sort of maintenance that will come with additional costs to upkeep an aging home.
All of these components factor into a potential buyer’s decision, and the compounding costs are intimidating. But as housers look to respond to these issues, ROAD and other efforts point to brighter skies ahead. The target federal funds rate remains elevated, but for now has at least remained stagnant.
And recent survey data from Bank of America shows some positive movement from respondents who believe a home is a valuable investment and in their confidence to purchase a home this year, with noted shifts away from the lock-in effect.
Further, the benefits of homeownership counseling cannot be overstated. Pre- and post-purchase counseling, particularly for first-time homebuyers, makes a tangible difference in helping buyers prepare for the financial realities of homeownership and better prepare them to be successful. NHC will dive further into this topic in our upcoming webinar in partnership with NeighborWorks® America, Celebrating 250: Life, Liberty, and the Pursuit of Homeownership.
The journey of homeownership is just that – a journey. Though the current conditions are not ideal, there is opportunity now for housers to maintain our current course towards better housing outcomes for new homebuyers and current homeowners. The ROAD legislation has something for everyone. The currents are rough, but the horizon remains. We need only to keep looking toward it.