It’s no secret that recent rising costs have made homeownership difficult for buyers, and a new Bankrate report is only adding more fuel to the (financial) fire. The report, published on April 1, concluded that, in order to buy a house at the average median price (which sells for $402,343, according to Redfin data), Americans need to make $110,871 annually. This is a whopping 46% increase from 2020, marking a tough road ahead for would-be buyers in an already tough market, and doesn’t include money in savings to buy a house.
Since January 2020, the number of states where you need to make $100,000 or more annually to afford a median-priced house has risen from seven to 22, plus the District of Columbia.
California tops the list of states where you need to make the highest salary to afford a home. If you want to buy a median-priced home in the Golden State, you’ll have to make $197,057, according to Bankrate’s data. A recent USA Today study, updated in March 2024, found that in California the cost of living makes up 77.2% of the average resident’s income. Hawaii was marked second-most expensive in the Bankrate report, requiring homeowners to make a $185,829 salary. In third was the District of Columbia, where homeowners need to make $167,871 annually.
Here are the top 10 most expensive states on Bankrate’s list.
According to Bankrate’s report, states in the Midwest and the South marked states with the greatest opportunity to buy — especially for first-time homebuyers. So if you’re trying to decide where to move, you might consider a state in those areas. Mississippi currently requires the lowest income to afford a home ($63,043), followed closely behind by Ohio ($64,071), Arkansas ($64,714), and Indiana ($65,143).
You can read Bankrate’s full report here.