The Hidden Housing Cost Pushing Millions of Homeowners Over Budget

A new roof can be just as essential to homeownership as a monthly mortgage payment. Yet only one of those expenses is factored in when determining whether an owner is housing cost-burdened.

Now, preliminary findings from Harvard University's Joint Center for Housing Studies (JCHS), presented on Friday, suggest that the omission has been hiding a much larger affordability problem in plain sight.

Under conventional measures, 22.7 million homeowners, or 26%, spent more than 30% of their incomes on housing in 2023—the threshold for being considered cost-burdened.

But when researchers included spending on routine maintenance and major replacement projects, that figure jumped to 28.4 million—nearly 1 in 3 homeowners.

"It would be a surprise to many that nearly every measure of cost burdens that you see out in the wild, including those that we most often published, do not account for these expenditures," says Alexander Hermann, a senior research associate at JCHS and co-author of the analysis.

For some homeowners, even that expanded measure may underestimate the financial strain.

The housing costs that don't show up in affordability statistics

Much of the housing affordability debate has focused on home prices and recurring expenses such as property taxes and insurance—and for good reason.

Between 2019 and 2025, homeowners' property tax expenses rose 31%, while average monthly homeowners insurance premiums jumped 72%, according to ICE Mortgage Technology data cited by Harvard.

But spending on home maintenance has also surged, with considerably less attention.

Between 2019 and 2023, homeowners' collective spending on routine maintenance climbed 61%, from $65 billion to $105 billion, according to Harvard's Improving America's Housing 2025 report. Even after adjusting for inflation, spending increased 35%.

And in the American Housing Survey data underlying the new analysis, maintenance and replacement spending grew faster than other housing expenses, including taxes and insurance, Hermann says.

So why has it been missing from affordability calculations?

Part of the problem is the data itself. Most major housing surveys don't ask homeowners what they spend on repairs. And unlike mortgages or property taxes, maintenance costs are irregular. A homeowner might spend thousands replacing a roof one year and nothing the next, making it difficult to translate into a consistent measure of affordability.

Then there's an even larger complication: What homeowners spend doesn’t necessarily reflect what their properties need.

Unlike a mortgage or tax bill, a major repair can be postponed when money is tight. That means a homeowner might report little or no spending even as their house deteriorates.

"These expenses can be deferrable to a point, but you can't put them off indefinitely," Hermann explains.

To capture costs that actual spending might conceal, the researchers developed a second estimate based on what homeowners could be expected to spend on upkeep, using property characteristics and spending patterns among middle-income households.

Under that approach, 30.8 million homeowners, or 35.5%, would be considered cost-burdened—roughly 8 million more than conventional estimates suggest.

America's aging homes are making affordability worse

As the U.S. housing stock gets older, understanding the nuance between what owners are spending and what their homes actually need is poised to become more important than ever.

The median owner-occupied home was 42 years old in 2023, compared with just 27 years old three decades earlier, according to JCHS.

And that age is already catching up. More than 22% of owner-occupied homes built before 1960 had a structural deficiency in 2023—more than twice the rate for homes built since 2000.

But the households facing the greatest upkeep needs are often those least equipped to pay for them.

"Lower-income homeowners, for example, are more likely to live in homes that require greater upkeep in the first place, and these households are at the same time least likely to have the resources they need to address those repair needs,” Hermann explains.

That disparity is already evident in what homeowners spend.

Among owners of homes built before 1960, households in the highest income quintile spent an average of $12,700 on improvements and repairs in 2023, compared with just $3,400 among those in the lowest quintile.

Of course, that difference doesn't necessarily mean lower-income homes need less work. Instead, it may mean their owners simply cannot afford to do it.

And that distinction helps explain why Harvard's estimates of expected upkeep spending reveal a much wider affordability gap than conventional measures suggest.

Three-quarters of homeowners earning less than $30,000 annually already exceeded the traditional housing-cost threshold. When researchers accounted for modeled upkeep spending, that share reached a staggering 93%.

For those earning $30,000 to $45,000, the rate climbed from 43% to 64%.

The cost of putting off repairs can come due at sale

Older homeowners also face a particularly difficult version of this affordability squeeze.

Among homeowners aged 65 and older, 32% were cost-burdened under conventional measures, compared with 45% when modeled upkeep costs were included.

Part of that can be attributed to the fact that retirement often brings lower incomes, even as aging homes require more expensive repairs. And while some homeowners can draw on savings or investments, others face a choice between preserving cash today and maintaining the value of their largest asset.

There’s already data that the trade-off can eventually work its way into the sale price of these homes.

An 80-year-old homeowner realizes an annualized return that's roughly half a percentage point lower than a 45-year-old homeowner, equivalent to a sale price that's more than 5% lower over the average 11-year holding period, according to research from the National Bureau of Economic Research.

Differences in renovations and property upkeep explained about a quarter of that age-related gap, while selling practices, including off-market transactions and sales to investors, also contributed.

The dilemma is gaining attention in Washington.

Earlier this month, a bipartisan group of lawmakers urged the Department of Housing and Urban Development to implement a new home-repair program, warning that some seniors cannot afford the updates needed to sell their homes without accepting steep discounts.

The Whole-Home Repairs pilot was authorized under the 21st Century Road to Housing Act, enacted in July, but federal funding has not yet been appropriated and the program has not been implemented.

Rachel Drew, director of Harvard's Remodeling Futures Program, argues that assistance should prioritize households with the greatest repair needs, ideally through grants rather than loans or tax benefits requiring upfront spending.

For homeowners who cannot afford to preserve their properties, repair assistance could protect both their housing and the wealth they have built.

As Hermann puts it, "All repair programs are affordability programs."