The biggest threat to the American Dream? Not enough homes

Central to the character of being an American is that we work hard, find good jobs, and buy that cute starter home. We expect good schools to send our kids to and a backyard for the dog. And along with the lifestyle perks of ownership, owning a home becomes one of the most important ways we build wealth and savings for our futures.

At Tomo, we call this the Real Estate wealth building ladder. The ladder starts with that starter home, often a federally supported mortgage. As our lives and families grow we dream of a bigger yard, a home office, and we move up to that next home. These move ups are powered by a larger mortgage which enables us to build more equity in our homes. This wealth building journey has continued for the last 40 years, with homes gaining about 4.1% in value each year since 1991 when the FHFA started tracking these numbers. This means that home value has exceeded the rate of inflation by 1.5 points, accumulating more and more wealth each year, at a far higher rate than someone could achieve with their own savings and investments. And this is why, for 66% of Americans, housing is their most significant way to save and build wealth.

But now this foundational wealth creation engine is under threat.

If we want young families to be able to buy a home, and get on the wealth building ladder, we need to balance the rise in total households with the total available new homes. Right now, we are dangerously out of balance in much of the country. This is a call for action by our local and state governments to view housing as a priority.

We all see and hear about homes being listed and receiving 10 offers in mere hours, lines around the corner in some areas to get into open houses—yes, that’s still happening. This is an unnatural situation which is driven by not enough homes available where people want to live.

Here are the facts:

The US population is adding 1.8 million people and 2 million households each year.
But, it’s only adding 1.6 million new homes each year (meaning 400,000 more families, every year, are simply out of luck if they want to buy).
Since this imbalance has continued for years, economists now believe the pent up demand for new homes is between 1.5 and 3.8 million.

So, until we close this gap, the people with the least economic means simply won’t have fair access to the American Dream.

Let’s do some quick math. The median sale price for a home in Phoenix is $462,000. This price is simply out of reach for many young families—even those with strong credit, multiple incomes, and good jobs. For example, if we consider that the median salary in Phoenix is $76,000, (per the 2022 census) this means that a family would need to spend a significant portion of their income on a mortgage. Given this, they would need to spend over 30% of their income on housing, which is considered a safe benchmark.

Of course, this picture gets even more concerning when we zoom in on a growing, highly competitive housing market like Phoenix. If you look into prices in desirable suburbs in Phoenix like homes in Gilbert or Chandler, the prices can be even higher. And this is because, in addition to the pent-up demand, builders are struggling to make a reasonable profit after the steep cost of land and regulatory constraints.
If we want our friends, families and kids to be able to participate in the American Dream we need to partner with our real estate agents, builders, and friends to ask our towns and states to support our families and tear out the red tape to drive responsible development—especially where it can help more families find cheaper homes in Phoenix and benefit first-time home buyers who simply can’t save fast enough to put more than 3% down.

Add your name to this call to action by signing this Change.org form and we will forward this to your local real estate boards so they can advocate for more housing for you.

Kind Regards,

Greg Schwartz

CEO, Tomo.com

Last Updated: September 2025