What you’re looking at here is three very different realities living in the same market. The green line is what it costs today to buy a home with current prices and rates. The blue line is what it costs to rent. The orange line is what existing homeowners are actually paying because they locked in low fixed rates years ago.

For most of the 2010s, those lines moved together. Buying wasn’t much more expensive than renting, and sometimes it was cheaper. That made moving, upgrading, or becoming a first time buyer feel reasonable.

Then Rates Reset In 2022 And Everything Broke

The cost to buy didn’t creep higher. It jumped. Monthly payments went from something like the mid $1,000s to the high $2,000s almost overnight. Rents kept rising too, but slowly and steadily. Existing homeowners barely felt it at all.

That gap is the freeze. Buyers pull back. Sellers don’t move. Inventory stays tight. Prices don’t clear the way they normally would.

Buying vs Renting Then vs Now

The relationship matters more than the absolute numbers.

Back in 2013, buying cost meaningfully less per month than renting. Through most of 2018–2021, buying and renting were roughly in line. The decision came down to lifestyle and confidence, not survival math.

Today, buying costs roughly 40% more per month than renting. That’s not a small premium. That’s a psychological wall. People feel it immediately, even if they can technically qualify on paper.

When buying is that much more expensive than renting, demand doesn’t disappear, it just waits.

What Has To Change For Affordability To Come Back

There are only a few ways out of this, and none of them are painless.

Rates can fall. Prices can fall. Incomes can rise faster than housing costs. In reality, affordability usually improves through a mix of all three and often through some economic discomfort along the way.

Here’s the hard truth…without stress in the labor market, housing doesn’t really reset.
If people feel secure in their jobs, they don’t sell. If they don’t sell, supply stays tight. If supply stays tight, prices don’t move enough to fix affordability, even if rates dip a bit.

That’s the paradox. Rate cuts driven by a strong economy tend to revive demand and push prices back up. Rate cuts driven by a weakening economy cool demand and bring supply to market. Only the second path actually improves affordability.

And psychology matters just as much as math. When people sense economic risk, they don’t rush to buy a house. They wait. That waiting itself freezes the market further, dragging out the adjustment.

So the most likely path isn’t a clean crash or a smooth recovery. It’s a long period of low transactions, awkward pricing, and frustration until either rates come down a lot, incomes catch up over time, or unemployment rises enough to force a reset.

Until that green line moves meaningfully closer to the blue one, the housing market stays stuck, not because people don’t want homes, but because the monthly payment doesn’t make sense anymore.