Housing demand ultimately runs on incomes, and today’s data shows a nuanced picture: earnings are still rising across much of the country, but the strength and durability of that growth varies widely by market. Those differences matter for builders navigating an affordability landscape that remains challenging even as economic fundamentals improve.
The National Picture
Nationally, median household income rose 3.9% year over year in 2024, reaching $83,700. While this marks a downshift from the post-pandemic pace, it aligns more closely with the 2010s era of stable, moderate growth. Since 2019, incomes are up a cumulative 21.9%, helping blunt the blow of rising home prices and larger monthly payments.
That cushion has limits, though. Once adjusted for inflation, real income growth tells a more restrained story. Real incomes rose 1.3% last year and are up just 0.6% compared with 2019, meaning much of the nominal progress has been absorbed by higher prices. It’s a dynamic that helps explain persistent consumer caution despite otherwise solid economic readings.
Market-Level Differences
This national backdrop sets the stage for sharper differences at the market level. Income performance varies not only in magnitude but in direction, providing early clues about which regions are best positioned to sustain demand as affordability pressures continue.
Over the past year, every top market saw incomes rise, a testament to resilient labor conditions. Still, only a handful exceeded the national pace, including Las Vegas, Orlando, Richmond, Naples, and Stockton. These markets are not necessarily the nation’s highest-earning, but their momentum may offer buyers a slightly wider buffer against today’s elevated costs. In dollar terms, the biggest gains clustered along higher-cost coastal markets such as San Jose, Seattle, and New York.
Stepping back to the post-2019 period reveals more structural shifts. Roughly 70% of Zonda’s top markets outpaced the national cumulative increase in incomes, reflecting the broader realignment triggered by pandemic-era mobility and remote work. The strongest performers line up with the same Sun Belt and Western metros that attracted outsized migration during this time, including Myrtle Beach, Miami, Lakeland, Tampa, Stockton, and Provo. Meanwhile, traditionally high-earning coastal markets like San Francisco, Washington, D.C., and New York posted more subdued gains as high starting wages and population outflows constrained growth.
A decade-long view reinforces the dominance of the West. Seven of the top 10 markets for 10-year income growth sit in this region, led by Stockton, Provo, and Riverside/San Bernardino. Notably, no Western markets appear in the bottom tier. Instead, slower-growing and energy-dependent metros populate the lower end.
Strategic Implications
Taken together, these trends highlight an important strategic framework. Income growth remains a key counterweight to affordability challenges, but its uneven distribution means some markets have more runway than others. Regions with sustained earnings momentum may be better positioned to absorb elevated rates and maintain pricing discipline, while markets with softer wage growth will likely prove more rate-sensitive.
The insights in this article were taken from more in-depth research reports published in Zonda’s National Outlook subscription.
