Every time I hear someone complain about today’s mortgage rates, I think about my parents. Back in 1987, they bought the house they still live in with a 30-year fixed mortgage rate of 10.40%. That’s right—double digits! Yet, they made it work, and so did countless others in the 1980s when rates were even crazier. Fast forward to 2025, with rates around 6.5%–7%, and people are acting like the sky is falling. So why does buying a home feel so much harder now? It’s not just the rates—it’s skyrocketing home prices, wages that can’t keep up, and big institutional buyers like BlackRock outbidding small players like me, an occasional house flipper. Let’s dive into the numbers and my own experience to unpack why today’s market is a different beast.

Mortgage Rates: A Blast from the Past vs. Today

Let’s start with the rates that have everyone talking. In the 1980s, 30-year fixed mortgage rates were no joke, swinging between 9.03% and a staggering 18.63% in 1981. In 1987, when my parents signed their mortgage, they locked in at 10.40%. The 1990s were kinder, with rates dropping to 6.49%–10.67%. Today, in 2025, we’re looking at 6.46%–6.94%, with a high of 7.79% in 2023. Compared to the rates of the 1980s, today’s rates are a bargain.

So why were my parents and others buying homes with rates that high? Back then, home prices were much lower relative to income, and people expected rates to drop (spoiler: they did). Plus, the market wasn’t flooded with corporate giants snapping up properties, which brings me to a big issue I face as a house flipper today.

Housing Affordability: When Homes Were Within Reach

The real story isn’t just rates—it’s whether you can actually afford a home. Back in the 1980s and 1990s, buying a house didn’t feel like scaling Mount Everest. Here’s how the numbers compare [Census Bureau], [National Association of Realtors]:

Year	Median Home Price	Median Household Income	Price-to-Income Ratio	Monthly Payment (30-Year Fixed)
1987	$85,600	$26,000	3.3	$759.93
1990	$97,300	$30,600	3.2	$856.45
1999	$137,000	$40,200	3.4	$864.00
2023	$445,567	$74,262–$81,000	5.5–7.76	$3,100–$3,500

In 1987, many people’s home cost about 3.3 times their income—a stretch, but manageable. Today, homes cost 5.5–7.76 times median income, the highest ratio on record. Even with lower rates, monthly payments are brutal: $3,100–$3,500 in 2023 compared to $759.93 in 1987. Adjusted for inflation, that 1987 payment is about $2,000 today—still way less than what buyers face now. The math shows why my parents could swing it, while today’s buyers are struggling.

Institutional Buyers: The Goliath to My David

As someone who flips houses in Western Pennsylvania, I’ve felt the squeeze of institutional buyers firsthand. Companies like BlackRock, Invitation Homes, and other Wall Street giants have been buying up single-family homes at an alarming rate. In 2021, institutional investors snapped up 24% of all U.S. single-family homes. Their share of single-family rentals jumped from 5% in 2022 to a projected 40% by 2030, driving up prices and rents in markets from Tampa to Phoenix.

These big players are a nightmare for small operations like mine. I’ll find a fixer-upper with potential, only to get outbid by a corporate buyer who can pay 20–50% above asking, cover high rehab costs, and hold the property for years to turn a profit. In Western Pennsylvania, I’ve lost deals to cash offers from firms that can wait out market dips, something I can’t afford as a small-time flipper. While some claim institutional buyers own less than 5% of homes nationally, and BlackRock insists they don’t compete with individual buyers, the reality on the ground feels different. Their deep pockets shrink inventory and push prices out of reach for first-time buyers and flippers like me.

Why the 1980s Were a Different Game

When my parents bought their home in 1987, they didn’t have to battle Wall Street. Homes were affordable—$85,600. Wages were rising faster than today, keeping pace with inflation. The market had more homes available, and institutional buyers weren’t gobbling up entire neighborhoods. My parents took on that 10.40% rate because they believed home values would rise (they did) and rates would fall (they did). It was a gamble, but the deck wasn’t stacked against them like it is now.

Navigating Today’s Market

Today’s housing market is a tougher climb. High prices, stagnant wages, and institutional buyers make it feel like you’re fighting Goliath. In Western Pennsylvania, home prices are lower than the national average, but I still see corporate cash offers outbidding local buyers and flippers like me. My advice? Look for undervalued properties in less competitive markets, consider adjustable-rate mortgages to manage rates, or hold off if you can until inventory improves. It’s not easy, but persistence is key—just like it was for my parents.

Wrapping It Up

Today’s mortgage rates are lower than the 10.40% my parents faced in 1987, but buying a home feels harder because of soaring prices, lagging incomes, and institutional buyers like BlackRock dominating the market. As a house flipper, I’ve been outbid by these giants who can afford to play the long game, leaving less room for small players and first-time buyers. My parents’ story proves you can overcome high rates with determination, but today’s market demands new strategies to beat the odds. Have you faced off with big investors or struggled to afford a home? Drop your story in the comments, and follow Market Pulse for more real estate insights!