David Hay — Haymaker Daily: There's No Place Like Home (if you can afford one) — US home price-to-income ~5×, mortgage payments ~35% of median income; builder margins slashed by subsidies (Jul 1 2026)

One-line take: A macro Daily on America's housing unaffordability. The median-home-to-income ratio is back to ~5× (down from the 5.8× 2022 peak but well above the 4.7× 2007-bubble top); monthly mortgage payments now eat ~35% of median household income, versus a ~20% norm from 1984 to 2021. New-home prices ran from ~$296k (2016) to ~$425k (+44%) and existing from ~$240k to ~$429k (+79%) — and the two have converged, which Haymaker reads as evidence of the heavy buyer subsidies builders are using to move inventory. Those subsidies have slashed the leading homebuilders' margins by one-third to one-half — he names D.R. Horton and Lennar illustratively (and notes, without naming it, that "the leading ETF comprised of these companies" is still within 10% of an all-time high and double its late-2022 level). Add surging home-insurance premiums (+21% 2021–24) and the average buyer's age soaring from 29 (1980) to 40 today, and it's a textbook K-shaped / two-speed economy problem policymakers seem unable to fix — with regulatory red tape the one lever he flags for reform. DHI and LEN are named only illustratively (as the margin case study), not as stance calls.

1. Stocks & names mentioned

Ticker	Name	Research	View	What he said	At
DHI	D.R. Horton	QT · SA · STK · FA	Neutral	Named illustratively (not a stance call) as one of the "leading homebuilders like D.R. Horton and Lennar" whose profit margins have been slashed by one-third to one-half by the buyer subsidies builders are using to move product as new- and existing-home prices converge. A margin case study for the affordability thesis, not a rated pick.	read
LEN	Lennar	QT · SA · STK · FA	Neutral	Named illustratively alongside D.R. Horton as a "leading homebuilder" whose margins have been cut one-third to one-half by the subsidies used to move product. A passing example in the housing-affordability argument, not a rated call.	read

"View" is Haymaker's stance in this post; DHI and LEN are Neutral because they are named only illustratively — as the case study for how buyer subsidies have compressed builder margins — not as buy/sell calls. Referenced only (no ticker): "the leading ETF comprised of these companies" (an unnamed homebuilder ETF, said to be within 10% of an all-time high and double its late-2022 level) — deliberately not assigned a ticker; the Consumer Federation of America and G&F / Mac Overton (secondary source) are cited references, not securities. Research: QT Qualtrim · SA Seeking Alpha · STK Stock Analysis.

2. Talking points

The headline: a median home now costs ~5× median income

At the 2007 housing-bubble peak it took 4.7× median household income to buy a median-priced home; today the ratio is 5× — down from the 5.8× worst-ever level hit in 2022, but "clearly and exceedingly problematic."
Higher interest rates played a major role, but so did the years of Fed-suppressed borrowing costs that "drove home prices to record levels" in the first place.

Mortgage payments have jumped from ~20% to ~35% of income

From 1984 to 2021, monthly mortgage payments consumed roughly 20% of median household income. Today that figure is near 35%.

Prices ran hard — and new vs existing have converged

Median new home: ~$296,000 (2016) → ~$425,000 today, a 44% rise. Median existing home: ~$240,000 → ~$429,000, an even larger 79% increase.
New and existing prices have converged to almost the same level — which "almost certainly reflects the subsidies builders have been providing to move their product."

The subsidy cost: builder margins cut one-third to one-half

The cost of those buyer subsidies has "slashed profit margins for the leading homebuilders like D.R. Horton and Lennar by one-third to one-half."
As a side note, "the leading ETF comprised of these companies remains within 10% of an all-time high and double where it was trading in late 2022" — i.e. the equities have held up far better than the margin picture would suggest. (Haymaker does not name the ETF.)

Insurance is the other affordability squeeze

Per the Consumer Federation of America, the average home-insurance premium rose 21% from 2021 to 2024; in many regions coverage is increasingly hard to secure "at all, at least at a non-prohibitive cost."

The social cost: the average buyer is now 40

The average age of homebuyers has soared from 29 in 1980 to 40 today — "extremely harmful to new household formation and social harmony."

The verdict: a K-shaped economy and a red-tape lever

The affordability crisis "aggravates what most Americans believe is a decidedly K-shaped, or two-speed, economy," and policymakers "appear to be at a loss."
The one area governments can do "serious soul-searching" is the regulatory front — streamlining red tape, though "virtually no known entities enjoy the half-life of government red tape."

3. In plain English

A jargon-free note on the two names — both mentioned only as illustrations, not as buy/sell calls. (Companion to the table above; renders on each ticker's consolidated page.)

DHI — D.R. Horton Neutral (illustrative)

D.R. Horton is the largest US homebuilder. Haymaker isn't rating the stock here — he uses it (with Lennar) to make a point: because homes have gotten so unaffordable, builders are effectively paying to close sales (buying down mortgage rates, throwing in incentives), and that has cut their profit per home by roughly a third to a half. Interestingly, he notes the homebuilder stocks/ETF have held near record highs anyway, so the market isn't yet pricing that margin squeeze as a problem.

LEN — Lennar Neutral (illustrative)

Summary derived from the paid Haymaker newsletter (text in transcript.txt) for personal study. Not investment advice. © Haymaker / David Hay for source material.