The Payment on a Median Home Ate a Record 33% of Median Income in 2025. At This Week's 7.40%, It's 35%.

If you’re saving to buy a house and it feels like the goalposts keep moving, the Fed just measured the field. In 2025, the mortgage and property tax on the median home ate about 33% of the median family’s income. That’s the highest the modern survey has ever recorded.

And 2025 was the cheap year. Run the Fed’s own formula at this week’s rate and it’s about 35%. Before insurance.

What the Fed measured

The Fed’s Survey of Consumer Finances came out Friday. Tucked into a box on housing is a simple test: take the median home, borrow 80% of it on a 30-year fixed, add property tax at 1% of the value a year, and compare the monthly bill to median family income.

In 2022 that came to 26%. In 2025 it hit 33%. The Fed says the jump “was driven mostly by the increase in interest rates,” with higher prices doing the rest. The median home was also worth more than 4.5 times median family income.

If you already own, the same report is good news. Owners’ median home equity rose to $230,000, and the Fed says housing wealth is sitting at a record high. The people inside the house are fine. The ladder up to the door got pulled.

Here’s the part that hits younger buyers hardest. Families under 35 saw their median net worth fall 23% to $33,000. A 20% down payment on the survey’s $375,000 median home is $75,000. That’s more than double what the typical young family has to its name.

We reran it at 7.40%

The Fed used Freddie Mac’s March 2025 rate, about 6.65%. Freddie’s survey for October 8 says 7.40%. Same house, same income, new rate.

A $300,000 loan at 7.40% costs about $2,077 a month in principal and interest. Property tax adds about $313. That’s $2,390 against a median monthly income of $6,850. Call it 34.9%.

The rate alone added about $151 a month since the Fed’s snapshot. To get back to 2022’s 26% at today’s rate, the same house needs a family income of about $110,300. Or, at the median $82,200, a house closer to $279,500.

Translation: the median house on the median paycheck is a stretch right now, and the Fed’s number flatters it. It leaves out insurance and HOA dues, and insurance alone has been pushing escrow payments up.

Run your own number

Don’t argue with a median. Plug your actual target price, your actual rate quote and your actual income into our mortgage calculator. Then add your real insurance quote and any HOA fee on top. Divide by your gross monthly income.

If you land well past a third, you have three levers: a cheaper house, a bigger down payment, or a different loan. An ARM can cut the early payment, but read the year-8 math first. Waiting for rates to fall is a bet, not a plan, and so far this fall it’s been a losing one.

Stretching past 35% before insurance is your call. Just make it with the full number in front of you, not the one in the listing.

About the numbers

The Fed’s figures are in 2025 dollars, from 4,367 family interviews. Our rerun holds the 2025 median home value and income constant and swaps only the rate, so it isolates the rate change. It doesn’t predict what prices or paychecks did since. Compare lenders on our best mortgage lenders page before you lock.

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