Getting your foot in the door of one of the lowest-priced homes on the market has become increasingly challenging—and rising prices are only partly to blame.

Financing options for a mortgage with a principal balance of $100,000 or less are increasingly harder to come by or carry much higher rates, according to a new report from Realtor.com. While the share of homes that have sold for $150,000 or less has shrunk considerably—from 36.7% in 2013 to 8.8% in 2026—the share of small mortgage originations has declined even faster, indicating structural barriers at play are affecting buyers, according to Joel Berner, senior economist at the Austin-based real estate site. 

“Small mortgages are not simply fading because lower-priced homes are harder to find; the financing itself has become harder to access,” Berner said in a statement. The faster decline in small mortgages relative to their sales, he says, “points to a market where the costs and complexity of originating a modest loan can stand between buyers and an attainable home.”

That’s because the 21st Century ROAD to Housing Act , which became law in July after President Donald Trump refused to sign the bill, may help to address some of the barriers that are keeping buyers of lower-priced homes on the sidelines. In addition to provisions that intentionally expand access to small mortgages, the law also sets out to address some of the fixed costs and delays associated with small loans that might be limiting activity in this part of the mortgage market.

Source link