by A key takeaway is that lower mortgage payments provide more room in the budget for durable goods purchases such as furniture
WASHINGTON — A recent report from the National Association of Realtors shows that housing affordability improved in a number of key areas in the fourth quarter, a factor that could open budgets to spending more on things such as furniture.
Overall, the report said, the national existing single-family home price rose 1.2% year over year to $414,900. The good news is that this was down from 1.7% in the third quarter, a shift that could help open the door to more young families owning a home.
“While most metro markets continue to see record-high housing wealth, some areas are experiencing home price declines,” said NAR Chief Economist Lawrence Yun. “These declining markets are concentrated primarily in Florida and Texas, where robust supply and recent home construction are increasing competition among sellers to attract buyers.”
Other key takeaways from the report are as follows:
+ 25% of markets experienced declining home prices, up from 23% last quarter.
+ The average monthly mortgage payment on a typical existing single-family home with a 20% down payment was $2,057, down 3.1% from the year before and down 5.7% from the previous quarter.
+ Typical families spend 22.9% of their income on mortgage payments, down from 24.7% last year and down from 24.5% last quarter.
+ First-time buyers spent $2,019 on their monthly mortgage payment for a typical starter home valued at $352,700 with a 10% down payment, down $62 from a year earlier and down $122 from the prior quarter.
+ First-time buyers spent 34.6% of their income on monthly mortgage payments, down 37.3% from a year earlier and down from 37% last quarter.
The NAR also said that home prices rose in 73%, or 168 out of 230, of metro areas in the fourth quarter of 2025, down from 77% in the third quarter.
Still there are indications affordability remains an issue for many as the median existing single-family home price rose in the Northeast (up 5.5% to $514,600), the Midwest (up 4.3% to $317,100) and the South (up .2% to $367,300) while declining in the West (down 1.2% to $625,800).
Five percent of metro areas — or 12 out of 230 — recorded double-digit price gains, up slightly from 4% last quarter.
And despite some modest improvements cited earlier, housing affordability undoubtedly will impact furniture sales or a least the amount people are willing to spend on furniture in the year ahead and perhaps beyond. Tariffs, which already are making product more expensive on retail floors — along with current interest rate levels still hovering above 6% — could impact furniture sales, particularly at lower price points that are susceptible to stretched consumer budgets.
Below is a snapshot of some areas where home prices are seeing gains.
The 10 large markets with biggest year-over-year median price increases are:
- Mobile, Alabama (+13.7%)
- Canton-Massillon, Ohio (+9.8%)
- Nassau County-Suffolk County, New York (+9.6%)
- Montgomery, Alabama (+9.4%)
- St. Louis, Missouri-Illinois (+9.1%)
- Shreveport-Bossier City, Louisiana (+8.4%)
- Youngstown-Warren-Boardman, Ohio-Pennsylvania (+8.3%)
- Providence-Warwick, Rhode Island-Massachusetts (+8.2%)
- Fort Wayne, Indiana (+8.0%)
- Hartford-West Hartford-East Hartford, Connecticut (+8.0%)
And the 10 most expensive markets are:
- San Jose-Sunnyvale-Santa Clara, California ($1,920,000; 0.0%)
- Anaheim-Santa Ana-Irvine, California ($1,396,500; +2.7%)
- San Francisco-Oakland-Hayward, California ($1,305,000; -0.8%)
- Urban Honolulu, Hawaii ($1,142,100; +3.5%)
- San Diego-Carlsbad, California ($994,000; +0.9%)
- Salinas, California ($995,500; +1.2%)
- Los Angeles-Long Beach-Glendale, California ($939,700; 0.0%)
- Oxnard-Thousand Oaks-Ventura, California ($936,700; +1.8%)
- San Luis Obispo-Paso Robles, California ($917,100; -1.1%)
- Nassau County-Suffolk County, New York ($818,800; +9.6%)
Is housing affordability an issue in your region? If so, how is your store or business trying to improve perceived value to consumers now and in the future? We would love to hear your thoughts. Feel free to email Tom Russell at tom@homenewsnow.com or Home News Now Retail Editor Kathryn Greene at kathryn@homenewsnow.com.
