Let’s talk Affordability

this will be a deeper dive, but it’s necessary to truly understand the issue of affordability in the US.

Everywhere you look, you’ll hear about an affordability crisis in America. But is that really the case? Let’s look at the numbers…

For the first time, the typical full-time American is better off than in late 2019. This is measured by real median weekly earnings. Essentially it’s inflation-adjusted earnings. Contrary to popular belief, wages are outpacing inflation. Wages are growing at a 4% clip while inflation hovers around 3%. From 2020-2022, inflation skyrocketed and American’s purchasing power took a huge hit (inflation outpaced wage gains). However, we have finally dug out of that hole.

In addition, home prices are expected to grow 2-4% in 2025. In comparison, 2021 saw 18.1%, 2022 saw 8.2%, 2023 saw 5.6%, and 2024 saw 4.5%. In other words, we are trending in the right direction.

I understand it’s hard for Americans to feel this growing affordability, or in the case of home prices - a slower increase in cost. But facts are facts and it’s important we communicate them.

One last point - the US budget deficit is expected to slightly decrease in 2025 and decrease even further in 2026. Why is that important? Not only does it dispel the myth that Trump isn’t doing anything about the deficit, but deficits contribute to inflation. Lower deficits will drive inflation down in addition to the residual lagging effect of higher interest rates.

In conclusion, affordability is actually getting better in America. The communist solution of more government spending would only drive inflation back up - let’s stop losing the messaging battle and get the facts out!