It's a tough real estate market no matter where you live, but some parts of the US are faring better than others.
Realtor.com released its annual housing report card on Monday, grading all 50 states and Washington, DC, from A to F based on how affordable homes are there and how much new housing is being built.
Joel Berner, a senior economist at Realtor.com, told Business Insider that homebuilding is an important indicator of a housing ecosystem because it signals how affordable homes will be over time.
"Without new homes being built, affordability will suffer under constrained home supply," he said.
Once again, the best-performing states — those earning either an A or a B grade — were concentrated mostly in the Midwest and South, regions known for their lower cost of living and abundance of relatively affordable homes.
Indiana ranked No. 1, largely because incomes there are relatively high compared with home prices, giving buyers more affordable options. But Berner said the state's "unremarkable" new-home construction could point to affordability problems in the future.
At the other end of the ranking, states that received grades between C and F were largely concentrated in the West and New England. Berner said building in these states is often slower and more expensive because of zoning rules, permitting delays, and building codes. As a result, they struggle to compete with states in the middle of the country, where land is cheaper, and building is generally easier.
Below are the 10 best and worst states in the US for affordability and homebuilding, according to Realtor.com.
Median listing prices and median household incomes for these states are from Realtor.com. Population data for each state is from the US Census Bureau.
The 10 best states for homebuilding and affordability
10. Oklahoma
- Grade: B
- Median listing price: $299,000
- Median Household income: $65,000
- Population: 4,123,288
9. Arkansas
- Grade: B
- Median listing price: $300,000
- Median Household income: $61,000
- Population: 3,114,791
8. South Dakota
- Grade: B
- Median listing price: $379,000
- Median Household income: $77,000
- Population: 935,094
7. Delaware
- Grade: B
- Median listing price: $486,000
- Median Household income: $88,000
- Population: 1,059,952
6. Nebraska
- Grade: B+
- Median listing price: $346,000
- Median Household income: $77,000
- Population: 2,018,006
5. North Carolina
- Grade: B+
- Median listing price: $299,000
- Median Household income: $65,000
- Population: 11,197,968
4. Texas
- Grade: A-
- Median listing price: $300,000
- Median Household income: $61,000
- Population: 31,709,821
3. South Carolina
- Grade: A
- Median listing price: $379,000
- Median Household income: $77,000
- Population: 5,570,274
2. Iowa
- Grade: A
- Median listing price: $486,000
- Median Household income: $88,000
- Population: 3,238,387
1. Indiana
- Grade: A
- Median listing price: $346,000
- Median Household income: $77,000
- Population: 6,973,333
The 10 worst states for homebuilding and affordability
10. New Hampshire
Grade: D+
Median listing price: $586,123
Median Household income: $96,809
Population: 1,409,032
9. New Jersey
Grade: D
Median listing price: $556,344
Median Household income: $99,357
Population: 9,500,851
8. Montana
Grade: D
Median listing price: $628,387
Median Household income: $72,066
Population: 1,137,233
7. Oregon
Grade: D-
Median listing price: $564,005
Median Household income: $80,356
Population: 4,272,371
6. Connecticut
Grade: F
Median listing price: $518,892
Median Household income: $95,392
Population: 3,675,069
5. California
Grade: F
Median listing price: $742,305
Median Household income: $95,065
Population: 39,431,263
4. Hawaii
Grade: F
Median listing price: $767,360
Median Household income: $94,556
Population: 1,446,146
3. Rhode Island
Grade: F
Median listing price: $563,235
Median Household income: $85,698
Population: 1,112,308
2. Massachusetts
Grade: F
Median listing price: $763,660
Median Household income: $98,170
Population: 7,136,171
1. New York
Grade: F
Median listing price: $668,173
Median Household income: $82,657
Population: 19,867,248
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Alcynna Lloyd is a real estate reporter with Business Insider. She writes about homebuying behavior, tiny homes, multi-generational housing, migration trends, and housing affordability.Prior to joining Business Insider, Lloyd was the Digital Media Manager at HousingWire.Do you have feedback or a tip? Find her on X/Twitter, LinkedIn, or email [email protected]. Some of her articles include:
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- I was tired of paying rent for my small business, so I bought the building. I've made over $100,000 renting it on Airbnb to support my café.
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Jordan reports on moving trends — from remote work to house hacking. He also writes about movers struggling with issues around relocating like buyer's remorse and the many intricacies of moving to an unfamiliar state. He also has stories focusing on property technology and in 2022, moderated a panel on fractional investing at real estate technology conference Blueprint. Before Insider, he covered luxury real estate in South Florida for The Real Deal. He holds a Master's degree in Magazine Writing from New York University and a Bachelor's degree in English from Florida State University.
