Less than 24 hours before Trump threatens to impose a global tariff on a raft of building materials—including lumber—the powerful National Association of Home Builders (NAHB) has forecast that 94 million US households (70% of the market) cannot afford an average-priced house ($400,000) based on income thresholds and underwriting standards.
The findings come as part of a housing affordability pyramid published in the 2025 Priced-Out Analysis, revealing the number of households able to purchase a home at various price intervals: “The largest share of households falls within the first step, where homes are priced under $200,000. As home prices increase, fewer and fewer households can afford the next price level, with the highest-priced homes—those over $2 million—having the smallest number of potential buyers.”
According to the NAHB, the pyramid is based on income thresholds and underwriting standards: “Under these assumptions, the minimum income required to purchase a $200,000 home at the mortgage rate of 6.5% is $61,487. In 2025, about 52.87 million households in the US are estimated to have incomes no more than that threshold and, therefore, can only afford to buy homes priced up to $200,000.”
“These 52.87 million households form the bottom step of the pyramid. Of the remaining households that can afford a home priced at $200,000, 23.53 million can only afford a top price of somewhere between $200,000 and $300,000. These households make up the second step on the pyramid. Each subsequent step narrows further, reflecting the shrinking number of households that can afford increasingly expensive homes.”
The new findings come after Wood Central yesterday reported that more than 70% of Americans surveyed by REsimpli believe that tariffs on lumber will negatively impact the US housing market. More than a third (33.75%) expressed a high level of concern that the trade war may have on the housing market supply chain.
“69.50% expect the housing market to become less liquid during a trade war, sparking fears of a potential slowdown in property transactions…(whilst) 55.92% of respondents expect negative impacts on long-term home affordability,” according to Asad Zaman, a real estate analyst who spoke to the Wood Central publisher. “More than 73% of respondents believe the trade war will have at least some effect on homebuyers’ ability to secure loans or mortgages, though most expect the impact to be moderate rather than severe.”
Last month, the NAHB warned that rising costs of softwood lumber were driving up the price of property and, in the process, making housing unaffordable to the majority of Americans: “In addition to the narrowly defined framing lumber, products such as plywood, OSB, particleboard, fibreboard, shakes, and shingles make up a considerable portion of the total material cost of a new home,” according to the NAHB’s latest report on Framing Lumber prices. “Surveys conducted by Home Innovation Research Labs show that the average single-family home uses 2,200 square feet of softwood plywood and 6,800 square feet of OSB, in addition to roughly 15,000 board feet of framing lumber.“
Then, there are inputs into cabinets, windows, doors, and trusses: “To account for the manufacturer’s margins, sawmill prices for the lumber embodied in these products are marked up by the percentage difference between receipts and cost of goods in the “wood product manufacturing” industry,” the NAHB said. “The bottom line is that changes in softwood lumber directly impact the price of a new home. This, along with the rising wages for construction workers and higher interest rates, is one of the reasons why the housing market is experiencing declining affordability.”
