The Geography of Pandemic-Era Home Price Trends and the Implications for Affordability

Home prices rose at an unprecedented pace in the aftermath of the COVID-19 pandemic as interest rates fell to record lows, the large cohort of millennials aged increasingly into prime homebuying years, and the supply of housing available for purchase remained limited. Using county-level data from Zillow and the US Census Bureau’s American Community Survey, this paper shows that home price growth was widespread across market types from March 2020 to March 2023, but increased most rapidly—rising by more than one-third—in rural counties, smaller metro areas, and the lower-density suburbs of large metro areas. By comparison, home prices rose by just 21 percent on average in higher-density urban counties. These trends represent a stark reversal from most of the past decade, when home prices had risen most rapidly in urban and higher-density areas, and they have enormous implications for affordability, especially in places that were previously more affordable. In rural counties, for example, home-value-to-income ratios rose from 2.5 in 2017 to 3.9 in 2023, meaning that the typical home value was nearly four times the median household income on average in those places, suggesting that many existing households could increasingly struggle to afford housing even in the nation’s lower-cost markets. Affordability worsened across market types, however, with home values rising to 6.0 times higher than household incomes in the densest urban counties.