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By Giulia Carbonaro
Senior Reporter
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The affordability challenges faced by American households have intensified in the months leading up to the midterms, with fuel prices surging as a result of the ongoing war in Iran and housing costs still historically high.
It is not what President Donald Trump promised in his 2024 campaign, which was boosted by Americans' frustration with soaring inflation under the Biden administration and skyrocketing home prices during the pandemic.
Two years ago, Trump pledged to bring down gas prices to below $2 per gallon and deliver 2 percent mortgage rates. Now, gas prices are at an average of $4.28 per gallon nationwide, up from $3.05 a year ago, according to the American Automobile Association (AAA), and the average 30-year fixed-rate mortgage is 7.32 percent, up from 6.19 percent, per Freddie Mac.
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As voters head to the polls next Tuesday, the cost of living and increasing consumer prices are set to be top of mind for a majority of Americans, with many set on punishing Republicans for the Trump administration's broken promises.
According to research by the Urban Institute think tank, 49 percent of people in American families are unable to cover expenses they need to live securely in their community. That is because a combination of key costs—including fuel and health insurance—have risen over the past year, some even faster than Americans' earnings. In some states, voters are feeling more financial pressure from one issue rather than another, but most are struggling.
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Electricity Bills
Using its new American Affordability Tracker, Urban researchers found that residential electricity bills outpaced earnings in 31 states between June 2025 and June 2026, with customers paying about $5 more per month on average this summer.
As of June, the average monthly residential electricity expenditure per customer was $171 nationwide, with Hawaii paying the highest bill in the nation at $255, followed by Arizona ($220), Texas ($210) and New Jersey ($208). At the other end, Montana was the least expensive at $103, followed by Wyoming ($106) and North Dakota and Washington ($114 each).
Gas Prices
Since January 2025, gas prices have risen by 33 percent, an average increase of $1.02 a gallon nationally, while nominal earnings have grown only 6 percent, according to Urban researchers.
Most of this surge has taken place since February 28, when the U.S. and Israel launched joint strikes against Iran. The attack kicked off the ongoing conflict that has disrupted the global supply of oil and put an effective chokehold on the Strait of Hormuz, where one-fifth of the world's oil normally transited. While no state has been spared by the recent rise in gas and diesel prices, drivers in some parts of the country are paying much more than others.
California drivers pay the most for gas, at just over $6 per gallon, while North Carolina has the lowest price in the nation, at about $3.48 per gallon, based on the latest AAA data. Three other states have average prices above the $5 mark: Hawaii ($5.65), Washington ($5.30) and Nevada ($5.30).
In 28 states, gas prices are below the national average: Massachusetts ($4.23), New Hampshire ($4.20), New Mexico ($4.20), West Virginia ($4.19), South Dakota ($4.19), Minnesota ($4.19), Iowa ($4.18), New Jersey ($4.17), Rhode Island ($4.15), North Dakota ($4.10), Florida ($4.09), Virginia ($4.04), Kentucky ($4.03), Indiana ($3.98), Maryland ($3.97), Kansas ($3.94), Missouri ($3.92), Oklahoma ($3.91), Delaware ($3.90), Arkansas ($3.84), Mississippi ($3.83), Tennessee ($3.81), Alabama ($3.81), Louisiana ($3.78), South Carolina ($3.76), Texas ($3.71), Georgia ($3.65) and North Carolina ($3.48).
Trump, who has repeatedly dismissed Americans' pain at the pump as a small price to pay for making sure Iran does not get a nuclear weapon—which his administration cites as one reason it started the war—has tried several measures to lower gas prices in recent weeks, with limited results.
Speaking at a rally in Georgia on October 24, Trump boasted about the U.S.—the world's largest oil producer—making a "fortune" from high oil prices, even as ordinary Americans are suffering.
Health Insurance Premiums
When it comes to health insurance, premiums for unsubsidized benchmark plans in the Marketplace rose by 22 percent between 2025 and 2026, according to Urban. Health insurance premiums for the second-lowest-cost Silver health plan on the Affordable Care Act Marketplace are up 22 percent since last year, now $611 per month.
The states with the highest year-over-year increases are Arkansas (69 percent), Washington (45 percent), Tennessee (38 percent), Mississippi (38 percent) and Texas (35 percent). During the same period, premiums in the employer-sponsored health insurance markets increased by 5 percent on average.
Housing and Child Care Costs
Housing and child care costs also continue straining family budgets, keeping millions of young people at bay from either homeownership and child-bearing.
The costs of child care and rent have climbed more quickly than earnings over the past decade, leaving families with two young children paying $6,600 more for child care annually and renters paying $710 more a month for housing than in 2017, according to the Urban Institute.
Young Americans' perceived financial inability to raise a child has persuaded many not to start a family in the first place. The U.S. birth rate fell to its lowest level ever recorded in 2025, according to the latest report from the Centers for Disease Control and Prevention, continuing a 20-year trend toward Americans having fewer children. While that is partially due to Americans' changing lifestyle, affordability and the ability to own a home have played a role, according to experts.
Millions of would-be homebuyers have been kept off the property ladder by higher rent costs and home prices.
Average monthly rents ranged from $3,000 in Hawaii to $1,160 in Iowa, a difference of $1,840 a month. New York ($2,900), California ($2,810) and Massachusetts ($2,670) were also among the most expensive states, while North Dakota ($1,190) and West Virginia ($1,210) were among the cheapest.
There is, however, some general good news: Since January 2025, rent increases have lessened, with earnings growing faster than rents in all but eight states: Connecticut, Hawaii, Massachusetts, Michigan, New Hampshire, Rhode Island, Wisconsin and Wyoming. In most of these states, housing inventory remains tight because of new construction being kept low by restrictive zoning, constrained levels of available land and labor shortages.
Home prices, on the other hand, are still rising—though at a slower pace than they were during the pandemic, as the market remains sluggish in the face of lower demand. In the second quarter of the year, according to Urban, the average home sale price was $493,000 for a typical U.S. home, having remained mostly flat since Trump took office.
As of the second quarter of the year, Hawaii had the highest average home sale price at $902,000, followed by California at $814,000, Massachusetts at $692,000 and New York at $667,000. Louisiana and West Virginia had the lowest average prices at $278,000 each, followed by Iowa at $289,000 and Arkansas, Ohio and Oklahoma at $298,000.
According to a new CNBC All-America Economic Survey, the cost of living was one of the most important issues for U.S. voters heading into the midterms, with respondents between 18 and 34 years old and men between 18 and 49 years old pointing at it as their top issue.
"I think housing could be the health care of 2024, given especially the need for Democrats to turn young people out who are inclined to be anti-Trump and pro-democratic," Jay Campbell, a partner at Hart Research, the Democratic pollster for the bipartisan survey, told CNBC.
Among all participants to the survey, which polled 1,000 registered voters between July 8 and 12, the costs of housing and health care were tied for the fourth most important issue facing the country, behind the cost of food and groceries, protecting democracy, and immigration and border security.
Contact Newsweek editors on this story: Matthew Robinson and Shakeema Edwards.
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