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Slowed home price growth, declining mortgage rates and rising incomes will contribute to the typical mortgage payment becoming affordable in 20 out of 50 of the country’s largest metro areas this year, the most since 2022.

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American homeowners are poised to see some welcome gains in affordability in 2026 after years of pinching pennies.

For this analysis, Zillow defined “affordable” as a mortgage payment on a typical home that is 30 percent or less than the median household income.

In the years since the COVID-19 pandemic, the cost of owning a home has spiked significantly. During the five years before the pandemic, mortgage payments on the typical home accounted for 22.5 to 26.5 percent of the median household income (with a 20 percent down payment).

But by October 2023, the typical mortgage payment required 38.2 percent of the median household income, a record low for affordability. At that time, seven out of 50 of the largest U.S. metros were affordable.

Nationally, a mortgage payment now takes up 32.6 percent of the median household income, which is the most affordable it’s been since August 2022, Zillow reported. By the end of 2026, that figure should hit 31.8 percent.

“This is what a small-wins year looks like for housing,” Zillow Senior Economist Kara Ng said in the company’s report. “Rising incomes, subdued price growth and gradually easing mortgage rates would help buyers regain their footing while allowing homeowners to continue building wealth. These types of slow and steady affordability improvements are exactly what the housing market needs over the long-run.”

Chicago, Illinois; Atlanta, Georgia; and Raleigh, North Carolina; are all expected to join the list of affordable large metros this year. Affordability is also expected to improve in all major markets, with the exception of Hartford, Connecticut, which the portal recently named the hottest market of 2026.

In order for mortgage payments to hit Zillow’s predicted 31.8 percent of median household income, mortgage rates would need to fall near 6 percent (which is expected, although rates are volatile), home values would need to grow by 1.9 percent and incomes would need to rise by 3.3 percent (the current Bloomberg consensus estimate).

In addition, this forecast model assumes borrowers will pay a 20 percent down payment, which could be burdensome for many homebuyers given that the typical U.S. home is valued at $359,078, which puts a 20 percent down payment at $71,800.

Assuming a 20 percent down payment and using the 6.2 percent average mortgage rate from December, the monthly cost for the typical American home today is $2,337, including taxes, insurance, principal and interest, Zillow said. That amount is down $92 per month from the same time last year and down $177 from a high in October 2023. By December 2026, the typical monthly payment should reach $2,358.

20 large affordable metros in 2026:

Chicago, Illinois
Houston, Texas
Atlanta, Georgia
Detroit, Michigan
Minneapolis, Minnesota
Baltimore, Maryland
St. Louis, Missouri
San Antonio, Texas
Pittsburgh, Pennsylvania
Cincinnati, Ohio
Kansas City, Missouri
Columbus, Ohio
Indianapolis, Indiana
Cleveland, Ohio
Oklahoma City, Oklahoma
Raleigh, North Carolina
Memphis, Tennessee
Louisville, Kentucky
Buffalo, New York
Birmingham, Alabama

Email Lillian Dickerson

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