Some states make it extremely difficult to buy a home. They do this by having sky-high real estate prices without the average salaries people would need to buy these homes.
Each state has been ranked according to the median home price ratio to the personal income per capita for the people in that state. The higher the ratio, the harder it is to buy a house there. These are the states that are the hardest to buy a home in.
Methodology
For this report, BestBrokers analyzed U.S. housing market data for 2023 provided by Redfin, one of the country’s largest national real estate brokerages. The dataset offers insights into the monthly median sales prices of various property types in every state. They calculated each state’s median price for all residential properties throughout the year and included that number in the analysis.
Additionally, they used data from the U.S. Bureau of Economic Analysis, providing every state’s personal income figures for the third quarter of 2023. These figures are shown in millions of dollars, seasonally adjusted at annual rates, and encompass the entire state’s income. To get the actual income per capita, they divided the income of each state by its population.
Finally, they determined the price-to-income ratio for each state by dividing its median home prices for the entire 2023 by the per capita personal income and ranked the states accordingly. They also calculated the income as a percentage of the median home price. As for the homes sold per 1,000 people figure, they divided the total number of properties sold in 2023 in every state by its population and then multiplied by 1000.
Hawaii
Living in paradise comes with a steep price. Hawaii is the least affordable place to buy a home, with an income of almost $66,000 and medium home prices of about $712,000. This gives it a ratio of a whopping 10.83.
California
California home prices are legendary, and affording a home is often beyond what most people can afford. The average per capita income is high at $80,000, but that’s no match for the median home price of about $766,000. It has a ratio of 9.47.
Utah
In Utah, the stunning scenery is expensive with a median home price of more than $533,000. Unfortunately, the per capita income isn’t that high at about $63,000. This gives Utah a ratio of 8.45.
Idaho
The per capita income in Idaho isn’t great at about $59,000. However, the median housing price isn’t that great either at almost $463,000. This gives the state a ratio of 7.83.
Montana
The average per capita income in Montana is a respectable 64,000. However, housing prices are about $500,000, making it hard to buy one. The state has a ratio of 7.80.
Oregon
Oregon has a lot to offer, but it doesn’t make it easy to buy a home. The median home is about $496,000 while the average per capita income is about $65,500. This gives them a ratio of 7.57.
Washington
Washington home prices are incredibly high, but the state also has high average incomes. The average income per capita is about $80,000, but the median home price is $597,000. The state’s ratio is 7.49.
Colorado
Houses are tough to afford in this mountain state. The average income is $79,600, but the median house price is more than $583,000. This gives the state a ratio of 7.33.
Arizona
The average income per capita in this beautiful desert state is about $62,000. This can make it hard to pay the median home price of $428,400. This gives the state a ratio of 6.90.
Rhode Island
The median home price in the smallest state is about $445,500, making it a difficult purchase for many would-be buyers. The average income is about $66,000. This state has earned a ratio of 6.74.
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