New Housing Index Sheds Light on the True Cost of Living Across U.S. Cities

A new housing affordability index developed by researchers affiliated with the University of San Diego is offering fresh insight into the widening gap between incomes and housing costs across major U.S. metropolitan areas.

The research, led by Norm Miller, PhD, Ernest W. Hahn Chair of Real Estate Finance, Emeritus, and Ian Kennedy, introduces a data-driven index designed to compare housing affordability across cities using a consistent national benchmark. The index evaluates how local incomes stack up against the cost of housing, offering a clearer picture of where Americans can realistically afford to live.

Rather than focusing solely on home prices or rents, the index measures the relationship between household income and the income required to afford housing in each market. This approach allows for a more standardized comparison across regions, revealing how affordability challenges differ between cities.

Early findings highlight the growing strain housing costs are placing on households in many of the nation’s most desirable markets. In several large metro areas, the income needed to afford typical housing far exceeds the median income of local residents. The data underscores the increasing difficulty many households face when attempting to enter or remain in high-cost housing markets.

For regions like San Diego—where housing costs consistently rank among the highest in the country—the index provides additional context for understanding the broader economic pressures affecting residents, employers and policymakers.

By translating complex housing data into a simple and comparable metric, the index aims to help researchers, industry professionals and policymakers better understand housing affordability challenges nationwide. Tools like this can support more informed conversations about housing supply, economic growth and long-term solutions to the affordability crisis.

Access the index, data, and findings here.