“In the past, if you were middle class, it was almost assumed you would become a homeowner,” Ali Wolf, chief economist of building consultancy Zonda, told Realtor.com in a report published Tuesday. “Today, the aspiration is still there, but it is a lot more difficult. You have to be wealthy or lucky.”

While household incomes have climbed “considerably” during the past five decades, they haven’t increased nearly as much as upper-income households, according to Pew Research Center, which considers middle-class household income to be about $90,000. In 1970, middle-class Americans made, on average, just about $60,000. Realtor.com’s analysis, however, uses the median household income of $74,580 reported by the U.S. Census Bureau in its calculations of middle-class housing affordability. 

With that income, a middle-class American wouldn’t be able to afford a median-priced home of $410,000, according to Realtor.com’s most recent data. Buyers typically shouldn’t spend more than 30% of their income on housing, according to the National Federation for Credit Counseling. That means a middle-class household could only afford about a $270,000 home if they put 10% down and had “little to no debt,” according to Realtor.com.

“To many Americans, finding a home that is considered ‘affordable’ is nearly impossible,” Tate Kelly, a broker with Coldwell Banker Warburg, tells Fortune. “It seems that now you are seeing ‘affordable’ housing is more around 35%-40% of your household income, which I don’t think many consider affordable.”

History of middle-class housing affordability

The inception of mainstream and widespread middle-class housing started back in the post-World War II era in light of the G.I. Bill that boosted benefits for veterans, the baby boom and “overall optimism that overtook the country after the war,” explains Gerard Splendore, another broker with Coldwell Banker Warburg. This is when home building was “on fire,” and suburbia really took off. These homes became the gold-standard for affordable starter homes with three bedrooms, a yard, and close proximity to schools, shopping, and other amenities.

“Over the course of history, being middle class almost guaranteed eventual homeownership,” Christopher M. Naghibi, executive vice president and chief operating officer at First Foundation Bank, tells Fortune. “You bought a starter home, built some equity, bought a bigger home as your family expanded and your career and investments progressed.” 

Indeed, much of the first several decades of Fortune, founded in 1929, were dedicated to chronicling the relationship between American business and what historians now regard as the heyday of America as a middle-class nation. After emerging victorious and relatively unscathed from World War II, the booming American economy created a middle-class society with few equals in all of world history, roughly lasting until the early 1970s and the onset of what the Federal Reserve calls “the Great Inflation.”

And homeownership was central to this middle-class lifestyle. According to a 2023 working paper from economists William Collins and Gregory Niemesh, an “unprecedented” 20-percentage-point surge in homeownership took place between 1940 and 1960, with the result that most Americans lived in homes they also owned. But things changed in the turbulent 1970s, as the roaring inflation led to a huge spike in interest rates and a nasty recession in the early 1980s, and it hasn’t been the same story for the middle class since.

Multiple economists have compared today’s housing affordability crisis with that of the 1980s, when mortgage rates peaked at about 18%—as well as with the fallout of the 2008 housing bubble and Global Financial Crisis. But other housing experts and financial executives argue we’re actually living in the least affordable housing market in history at this exact moment.

“We are at the worst housing affordability since the early 1980s according to the data,” Naghibi says. “But if you want my personal opinion, I think it is the worst ever.” Not only are mortgage rates and home prices gatekeeping new homebuyers from the market, but they’re also missing out on critical equity-building years, he says.

Will housing affordability get any better in 2024?

While some housing market forecasters predicted a drop in mortgage rates and home prices for 2024 in the latter part of 2023, many have started making adjustments to their projections. Zillow now predicts a 3.7% increase in home prices. Moody’s Analytics chief economist Mark Zandi even expected home prices to drop in 2023, but they ended up increasing by 5%.

Mortgage rates are down compared to their October 2023 peak, but they’ve been back on the rise during the past couple of weeks, approaching 7%. That, combined with higher home prices, has left many economists and housing market experts pessimistic about housing affordability improving this year. 

If mortgage rates drop, then more buyers might be able to increase their budgets and afford a home that meets their needs, Kelly says, but new construction is “lacking” and overall housing market inventory is low. 

That “gives buyers fewer options and opportunities to buy what they can afford,” he says. “I believe that inventory will slowly increase throughout the year, but I don’t think that it will be significant enough to affect affordability.”