NAR Expert Notes Pa. Home Prices Increased 57.3% in Five Years

The U.S. is experiencing a K-shape economy, which is reflected in the housing industry, according to Dr. Jessica Lautz, deputy chief economist and vice president of research at the National Association of Realtors®.

Lautz, who spoke with Realtors® in Harrisburg during PAR’s Spring Business Meetings, noted “there are a host of buyers who can buy a home with cash, and the first-time homebuyers who are struggling to purchase a home.”

The national inventory of existing homes in April 2026 was approximately 1.47 million, which has risen to just slightly more than the 1.46 million in February of 2020. Lautz noted that in most Pennsylvania metros, there is an acute housing shortage for buyers earning less than $50,000.

“Home prices are still going up, and you need to have solid finances to purchase a home in today’s market,” Lautz said. The national median existing-home price has escalated over the past 15 years. In Pennsylvania, she noted that the home price appreciation has increased 57.3% from 2020 to 2025.

“There is an enormous pipeline of young people who have been waiting a long time to buy a home. There is a great deal of pent-up demand. And first-time buyers have hit an all-time low of just 21% of the market in 2025, compared to 44% of the market in 1981,” – Dr. Jessica Lautz

Finance Changes

The qualifying income needed for median-priced homes with 20% down nationally has risen to $101,520, compared to $32,112 in 1995. She said in Philadelphia, the qualifying income is $91,000, in Harrisburg-Carlisle it’s $63,000 and in Pittsburgh it’s $52,000.

Lautz pointed out that nationally all-cash buyers were a larger portion of the market in 2025. For repeat buyers, all-cash buyers are 30% of the market, compared to 8% of first-time buyers, who are a median of 40 years old. In Johnstown, 53.2% of buyers are purchasing with all cash, and in Harrisburg, 35.4% are all-cash buyers.

“Downpayments are up,” she noted, “with 59% of first-time buyers using savings. It’s also the first time that financial assets as a downpayment have outpaced the bank of mom and dad, and inheritance has hit an all-time high of 8%.”

In addition, the median length of ownership of a home has significantly increased. “In 1987, homeowners moved every five to seven years. In 2025, owners remained in their home 11 years.”

Lautz noted several demographic changes that NAR has observed in its research.

“There is an enormous pipeline of young people who have been waiting a long time to buy a home,” she said. “There is a great deal of pent-up demand. And first-time buyers have hit an all-time low of just 21% of the market in 2025, compared to 44% of the market in 1981.”

“First-time buyers face huge hurdles in the market, including low inventory, higher home prices, higher mortgage rates, student loan debt, higher rental prices and childcare costs,” Lautz said. “For example, in Boston, childcare can cost to $2,500 per month.”

“With the first-time homebuyer average age of 40 years old, compared to 28 years old previously, this represents approximately $150,000 in lost equity over time,” she noted.

Demographic Shifts

The demographics of first-time buyers have also shifted, with married couples being just 50% of buyers, down 25% compared to 1985. Meanwhile, single women buyers are 25% of the market, up 14% in the same time frame. Unmarried couples account for 11% of first-time buyers, and single men represent just 10%.

Just 24% of homebuyers have children, compared to 58% of buyers in 1985.

Owning a home continues to be a large contributor to building net worth. “NAR estimates that the median net worth of homeowners is $446,000 in 2026, while renters’ is just $12,000.”

Lautz also noted that the real estate industry accounted for $177.1 billion, or 16.8%, of the Pennsylvania economy in 2025. And the economic impact of a typical home sale in the commonwealth is $91,450. You can find more NAR research information and resources in NAR’s Monthly Research Update, Residential Real Estate Market Snapshot, Metro Market Statistics and NAR’s Research Ambassador.