Homes are hovering near the most unaffordable they've been in two decades, and conditions pricing most buyers out of the market likely won't fade anytime soon.

A confluence of factors has placed pressure on potential homebuyers. Home prices have surged as a historically small number of homes have been listed for sale. Mortgage rates are also near their highest in decades as the Federalꦦ Reserve has pushed up interest rates to combat inflation. These factors have pushed monthly mortgage payments on median-priced homes well out of reach for all but hig🍎h-earning buyers. 

The Atlanta Federal Reserve's Home Ownership Affordability Monitor measures whether a typical U.S. family earns enough to obtain a mortgage based on current interest rates and home prices. In October, it fell to its lowest point since it began tracking in 2006. It has rebounded slightly but remains near at least 20-year lows.

However, this may not be the peak of housing unaffordability. Data show and experts say home pౠrices could continue to rise for the next fewඣ years.

No Price Slowdown in Sight

Online real estate brokerage Redfin found median home prices rose 6.2% in the year ending in April. Estimat🤡es show those gains may moderate, but prices most likely will 𒅌keep rising.

For example, CoreLogic expects home prices will grow by 3.7%. Homebuyers and sellers think home prices will grow by 5.1% in the year ahead. Lawrence Yun, chief economist with the National Association of Realtors, also sees prices risi🎐ng, estimating 2% to 3% growth in the next year.

"It is quite remarkable, in an environment with interest rates at 20-year highs, that housing demand still remains strong," Yun said.

Supply and Demand Need To Be Balanced

Demand has remained strong despite the 澳洲幸运5开奖号码历史查询:historically small number of home⛎s for sale. A third of all homes listed for sale nationwide have received m✤ultiple bids, Yun said.

Estimates vary on how much demand currently overwhelms supply. Robert Dietz, chief economist with the National Association of Home Builders places the deficit at 1.5 million; Yun estimates it's as high as 5 million.

Declining mortgage rates would likely make payments smaller and could boost the ꦓnumber of home sales—if not necessarily reduce prices, economists say. High mortgage rates have prevented millions of homes from being sold, as own꧑ers with low interest rates are reluctant to sell and finance a new mortgage at a higher rate.

Rates could fall if the Federal Reserve 澳洲𒊎幸运5开奖号码历史查询:follows through onไ interest rate cuts that appe🥃ar, at least tempo💜rarily, delayed by persistent inflation.

"As the Fed moves into easing mode, you might get into a counterintuitive effect with buyers more willing and sellers more willing," Dietz said.

But Yun emphasized that won't change the primary problem reducing affordability and boosting prices.

"Demand will still outpace supply," he said. "We will still have that housing shortage in place."

More Homes Need To Be Built, But Thereꦡ Are Hurdles to Constru👍ction

A seemingly simple answer exists to the supply shortage: Build more houses. But Dietz and Yun agree that's easier said than done.

The current ⛦shortage reflects chronically low housing starts during the decade after the global financial crisis of 2008 and 2009.

Zoning and regulations have limited home construction in many states, such as California, they said, conꦓtributing to the price disparity that exists from market to market. Dietz estimates regulatory costs account for a quarter of the cost of the average new home.

In addition, persistent employment shortages have limited construction. In any given month, Dietz said, the construction industry is short about 400,000 workers to build the 1.2 million new homes needed annually in the next few years to "make a dent" in the housing shortage.

"If we're serious about addressing the housing affordability crisis—and it is a crisis—we have to simply provide more affordable housing," Dietz said. "The affordability challenge is going to continue for the next couple of years."