Affordability Improves Slightly for Veteran Homebuyers, But Most Homes Are Still Out of Reach
Redfin reports 22% of U.S. home listings are affordable to the typical U.S. military veteran using a VA loan
Nationwide, just over one in five (21.8%) home listings are affordable to the typical U.S. military veteran using a VA loan, while 26.5% are affordable to the typical veteran using a conventional loan. That's according to a new report from Redfin, the real estate brokerage powered by Rocket.
Affordability has improved slightly over the last two years. Just 20.2% of listings were affordable to the typical veteran using a VA loan in 2023, and 25.5% were affordable to veterans using a conventional loan, the lowest shares on record.
For comparison, a similar share (22.8%) of listings are affordable to the typical U.S. non-veteran household with a conventional loan. That's a slight improvement from 2024's low point, when 21.7% of listings were affordable for non-veterans.
Homebuying affordability has improved marginally for both veterans and non-veterans over the last two years because monthly housing payments have declined, while incomes have risen:
- The average mortgage rate was 6.81% in 2023, and it is 6.66% today. Home-sale prices have flattened; the median U.S. sale price has posted a sub-2% year-over-year increase since April. The median monthly housing payment is lower now than it was two years ago.
- The median household income for veterans is an estimated $85,955 this year, up roughly 10% since 2023. For non-veterans, it is an estimated $81,078, also up roughly 10% over that period.
Veterans using VA loans are consistently able to afford fewer listings than homebuyers who take out conventional loans. Even though the typical veteran earns more than the typical non-veteran—and VA loans come with a slightly lower mortgage rate and no private mortgage insurance—90% of VA loan users make no down payment, which inflates monthly payments.
"VA loans provide a great opportunity for first-time veteran homebuyers to purchase a home without the substantial down payment that's required of most buyers these days," said Redfin Economist Grishma Bhattarai. "It allows them to get their foot in the homeownership door and start building equity, but it comes with the tradeoff of a bigger loan and higher monthly costs. That tradeoff is likely the reason why some veterans choose to take out a conventional loan and make a down payment, even if they qualify for a VA loan."
Nationwide, 7.3% of mortgaged homebuyers used a VA loan in August. That's a small share, but it's up from 6.5% a year ago, and it's the highest share of any August in six years. More people are taking out VA loans because in today's buyer's market, more sellers are open to accepting buyers coming with no down payment.
Veterans Using a VA Loan Could Have Bought 53% of U.S. Listings in 2015, Before Housing Affordability Eroded
Veterans (and non-veterans) can afford far fewer listings than they could have a decade ago. A veteran using a VA loan could afford more than half (53%) of home listings nationwide in 2015, more than double the share they can afford today. A veteran using a conventional loan could afford roughly 57% of listings in 2015, and a non-veteran using a conventional loan could afford about 52%.
It has become much more difficult to afford a home because sale prices skyrocketed during the pandemic, then rising mortgage rates pushed monthly housing payments to new heights.
The hike in housing costs has far outpaced income increases over the last 10 years. The median U.S. home-sale price has roughly doubled over that period, with the biggest jump in 2021, when record-low mortgage rates and remote work caused a homebuying frenzy. The typical veteran's household income has increased by 48% over that period, roughly half the rate of home prices. The typical non-veteran's income has increased 54%.
Even with access to financial tools like VA loans, the typical veteran is priced out of many listings. A low-down-payment loan can only do so much when home prices and mortgage rates are elevated. The bright side is that homebuying affordability has started improving in parts of the country where home prices are declining, including several Florida metros, Phoenix, and Atlanta. And mortgage rates have come down from their peak, with the average 30-year fixed rate sitting near its lowest level in a year.
More Than Half of Listings Are Affordable to VA Borrowers in Detroit and San Antonio
Three in five (60%) home listings are affordable to a veteran using a VA loan in Detroit, more than any other major U.S. metro area. Next comes San Antonio, where more than half (53.4%) of listings are affordable. It's followed by Cleveland (48.3%), Pittsburgh (43.6%) and Baltimore (42.7%).
The ranking is the same for veterans using conventional loans, though they can afford a slightly higher share of listings: In Detroit, 64.9% of listings are affordable to that group. Next are San Antonio (61.1%), Cleveland (53.3%), Baltimore (49.9%), and Pittsburgh (49.3%).
On the flip side, veterans can afford almost no home listings in California. In San Jose, Los Angeles and San Francisco, a veteran using a VA loan can afford less than 1% of for-sale homes, the smallest shares in the country. Next come San Diego and Anaheim, where they can afford roughly 2% of listings.
Using a conventional loan, veterans can afford 1% or fewer listings in San Jose and Los Angeles, 1.3% in San Francisco, 3.6% in San Diego, and 2.9% in Anaheim.
Veterans, like other homebuyers, can afford a far higher share of homes in places where homes are relatively affordable than in places where homes are expensive. The typical Detroit home sold for $215,000 in September, while the typical San Jose home sold for $1.6 million.
To view the full report, including charts, methodology and additional metro-level data, please visit: https://www.redfin.com/news/veteran-homebuying-affordability-2025
About Redfin
Redfin is a technology-driven real estate company with the country's most-visited real estate brokerage website. As part of Rocket Companies (NYSE:RKT), Redfin is creating an integrated homeownership platform from search to close to make the dream of homeownership more affordable and accessible for everyone. Redfin's clients can see homes first with on-demand tours, easily apply for a home loan with Rocket Mortgage, and save thousands in fees while working with a top local agent.
You can find more information about Redfin and get the latest housing market data and research at Redfin.com/news. For more information about Rocket Companies, visit RocketCompanies.com.
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