Cheapest State to Buy a House in 2022

Home affordability can vary widely from one place to the next, especially with unique taxes, utilities, and other expenses associated with any given city. So many variables can make it hard to find the cheapest state to buy a house.

While one region may have more expensive home prices, there are also differences in salaries to offset those price points. 

Are you looking for the cheapest state to buy a house in? We used income data and home prices to determine the top 15 most affordable states in the nation. Keep reading to see which states are on top and plan your next interstate move.

15 Cheapest States to Buy a House:

1. Iowa
2. Indiana
3. Ohio
4. Nebraska
5. Kansas
6. Mississippi
7. West Virginia
8. Oklahoma
9. Michigan
10. Arkansas
11. Alabama
12. North Dakota
13. Kentucky
14. Missouri
15. South Dakota

5 Most Expensive States to Buy a House:

1. Hawaii
2. California
3. Oregon
4. Washington
5. Colorado

U.S. map showing housing costs by state compared to the average resident's income. First-time home buyers can live more cheaply off the coasts (and so can we all) - Homebuyer.com

1. Iowa

  • Median Home Price: $147,800
  • Estimated Monthly Mortgage Payment: $702

Iowa came in at the top of our list of the most affordable homes in America. It takes a mere 10.6% of the median household income to afford a home in the Hawkeye State. Homes clock in at just $147,800.

This Midwestern state is the largest producer of corn in the country, and its miles of farmland are a testament to that. Still, there are plenty of big cities to live in, too. The largest housing markets in Iowa include Des Moines, Iowa City, and Cedar Rapids.

2. Indiana

  • Median Home Price: $141,700
  • Estimated Monthly Mortgage Payment: $673.23

Indiana takes the runner-up spot with a median home price of $141,700. It takes just 11.03% of the median income to buy a house in Indiana. The estimated monthly mortgage payment is just over $670.

Another Midwestern state, Indiana is flat and full of farmland. Its biggest cities are Indianapolis, Fort Wayne, and Bloomington, and major universities like Purdue, Ball State, and Indiana University are located there.

3. Ohio

  • Median Home Price: $145,700
  • Estimated Monthly Mortgage Payment: $692.24

Ohio continues the Midwestern trend, taking third place on our list. The Buckeye State requires just 11% of the average earner’s income to buy a house. Home prices sit at $145,700.

The birthplace of the Wright Brothers and home to the Rock and Roll Hall of Fame, Ohio certainly has a lot going for it. The state’s also big on football — and most residents cheer for the Cincinnati Bengals, the Cleveland Browns, or the Ohio State Buckeyes.

4. Nebraska

  • Median Home Price: $155,800
  • Estimated Monthly Mortgage Payment: $740.22

In Nebraska, residents will spend just 11.19% of their income — about $740.22 — on a mortgage payment for a median-priced home. House prices in the state are just under $156,000 

If its nickname — the Cornhusker State — is any indication, Nebraska is big on corn farming. Its cattle industry is booming, and it’s often called the “Beef State” as well. Nebraska’s biggest towns are Omaha and Lincoln.

5. Kansas

  • Median Home Price: $151,900
  • Estimated Monthly Mortgage Payment: $721.70

Kansas and Nebraska technically tied for fourth, with each costing 11.19% of the median household income to buy a house. Homes in Kansas are lower-priced, though. The median home costs $151,900 in this state.

Kansas is playfully referred to as the nation’s “breadbasket” for its plentiful wheatfield and grain production. Kansas City, Wichita, and Topeka are the state’s biggest cities. 

6. Mississippi

  • Median Home Price: $119,000
  • Estimated Monthly Mortgage Payment: $565.38

Homes are just slightly less affordable in Mississippi than in Kansas and Nebraska. Here, it takes 11.31% of the median household income to buy a house. Home prices sit around $119,000.

Mississippi is known as the Magnolia State thanks to its flowering state tree. It’s also one of the leading producers of catfish and is full of down-home Southern charm. Its biggest cities are Jackson and Biloxi.

7. West Virginia

  • Median Home Price: $119,600
  • Estimated Monthly Mortgage Payment: $568.23

In West Virginia, homes are right on point with Mississippi. It takes 11.31% of the median household income to buy a house, and the typical home costs just under $120,000.

Aptly named the Mountain State, West Virginia is nestled right in the Appalachians. It’s known for its rolling hills, valleys, and mountains — and all the outdoor activities that come with them.  

8. Oklahoma

  • Median Home Price: $136,800
  • Estimated Monthly Mortgage Payment: $649.95

Oklahoma homes are just slightly less affordable than Mississippi’s, clocking in at 11.64% of the median household income. The typical home costs $136,600, just about double the state’s median income.

Oklahoma is known for its deep Native American history. The name “Oklahoma” comes from the Choctaw language, and the state is still home to many reservations. The state also has a huge college football scene, with most cheering on either Oklahoma University or Oklahoma State. 

9. Michigan

  • Median Home Price: $154,900
  • Estimated Monthly Mortgage Payment: $735.95

In Michigan, a median-priced home takes just 11.73% of the typical household income, which is $75,300. Home prices cost a median $154,900 in the state.

The state’s most known for the Great Lakes and its auto production, which takes place in the Motor City of Detroit.

10. Arkansas

  • Median Home Price: $127,800
  • Estimated Monthly Mortgage Payment: $607.19

It takes 12% of the median household income to afford a house in Arkansas. Home prices check in at just under $129,000, and the average mortgage payment is $607.19.

Arkansas is known for its acres of lakes, as well as its hot springs and rivers. The state also produces the nation’s most poultry and is known as “The Land of Opportunity.”

11. Alabama

  • Median Home Price: $142,700
  • Estimated Monthly Mortgage Payment: $677.99

Alabama takes the eleventh spot for the cheapest state to buy a house in. In the Cotton State, homes take just 12.2% of the average household income. Home prices sit at $142,700.

If you’re itching for that true Southern feel, Alabama’s the place to head. Known for its football, southern hospitality, and sprawling plantation homes with curb appeal, you’ll feel right at home in major cities like Montgomery, Birmingham, or Mobile.

12. North Dakota

  • Median Home Price: $193,900
  • Estimated Monthly Mortgage Payment: $921.24

North Dakota homes take only 12.27% of the median household income to buy a house, putting it twelfth on our list of cheapest states to live in. The typical home costs $193,900, and the median income is just over $90,000.

The state is largely known for its wheat production, and it’s one of the nation’s least populated states. It’s named for the Sioux Dakota people who once lived in the area. 

13. Kentucky

  • Median Home Price: $141,000
  • Estimated Monthly Mortgage Payment: $669.91

Kentucky’s homes take just 12.35% of the typical household income, which clocks in at $65,100. A median home costs $141,000, making it our thirteenth cheapest state to buy a house in.

Also known as the Bluegrass State, Kentucky is known for its horse racing, tobacco farming, fried chicken, and coal mining. The biggest cities in the state are Louisville, Lexington, and Frankfort.

14. Missouri

  • Median Home Price: $157,200
  • Estimated Monthly Mortgage Payment: $746.88

A median-priced home in Missouri takes just 12.4% of the typical household income in the state. Home prices clock in at just over $157,000, while the average household earns $72,300 per year.

The Show-Me State is known for its blues and jazz scenes, as well as its world-famous barbecue. The state’s Anheuser-Busch company is the largest beer producer in the country. 

15. South Dakota

  • Median Home Price: $167,100
  • Estimated Monthly Mortgage Payment: $793.91

In South Dakota, you’ll pay just 12.62% of your income to buy a median-priced house, which sits at $157,200. The typical mortgage payment is just shy of $800 per month.

Known as the Mount Rushmore State, it’s clear what national monument South Dakota is famous for. The state also boasts the highest point in the Rocky Mountains and has a booming agricultural industry, which cranks out corn, soybeans, wheat, pork, and beef.

5 Most Expensive States to Buy a House

Hawaii is the most expensive state in which to buy a house. It's also the toughest state to drive to.

You may be surprised by home costs when making an offer on a house in these states. These home prices soar above the affordable ones listed previously. This is often due to booming populations, supply shortages, surging demand, or a combination of all three.

1. Hawaii

  • Median Home Price: $615,300
  • Estimated Monthly Mortgage Payment: $2,923.36

Hawaii holds the title of least affordable state to buy a house in. Residents of the island state pay a whopping 35.15% of the median income to afford a home. The median home in Hawaii costs $615,300.

Known for its pristine beaches and incredible weather, Hawaii’s an in-demand place for vacationers and residents alike. The state boasts six islands, but Oahu, home to capital Honolulu, is the biggest.

2. California

  • Median Home Price: $505,000
  • Estimated Monthly Mortgage Payment: $2,399.32

California’s well-known for its high housing costs, so its place on our most expensive list is no surprise. It takes almost 32% of the median household income to afford a house here.

Dubbed the Golden State for its gold rush days, California is the second-largest, and most populous state in the nation. It’s home to major cities like Los Angeles, San Diego, San Francisco, and Sacramento. 

3. Oregon

  • Median Home Price: $312,200
  • Estimated Monthly Mortgage Payment: $1,483.30

Our third most expensive state is Oregon, where it takes 21.92% of the median household income of $81,200 to buy a house. The typical home costs just over $312,000.

Oregon is known for its rain, lush forests, variety of lakes and canyons, and miles of shoreline. It’s home to major cities like Portland and Salem (not to be confused with Salem, Massachusetts, where the Salem Witch Trials took place).

4. Washington

  • Median Home Price: $339,000
  • Estimated Monthly Mortgage Payment: $1,610.63

Another West Coast state takes fourth for most expensive states to live in. In Washington, it takes just over 21% of the median income to afford a house. The typical home costs $339,000.

Known as the Evergreen State for its plentiful forests, there’s no shortage of hiking opportunities in Washington state. The state is big on fruit production (apples, namely) and is home to Seattle, the eighteenth biggest city in the nation.

5. Colorado

  • Median Home Price: $343,300
  • Estimated Monthly Mortgage Payment: $1,631.06

Rounding out the five most expensive places to buy a home is Colorado, the fourth Western state to make the list. It takes the typical earner more than 21% of their income (about $93,000, on average) to afford a house here. 

Colorado is known for its soaring mountains and booming ski towns like Aspen, Vail, and Telluride. The state is also home to major cities like Denver, Boulder, and Colorado. 

Ready to buy a house?

Buying a house that’s well within budget is essential for long-term success as a homeowner. Now that you know the cheapest states to buy a house, have you decided where you want to live? Get in touch to get pre-approved for your mortgage today.

Methodology

We used median home value and median household income data to determine what percentage of a household’s income paid the monthly mortgage payment in each state to determine affordability. 

We assumed all home mortgages were bought with a 30-year loan and a four percent interest rate for the purpose of this study. 

Sources: World Population Review | HUD

Listing all 50 states into a map that shows how much income it takes to pay the estimated mortgage costs. Only two states have housing costs that exceed 30 percent of the typical household income.

 

Dan Green

Dan Green

Dan Green is a former mortgage loan officer and an industry expert. He's appeared on NPR and CNBC, and in The Wall Street Journal, Bloomberg, and dozens of local newspapers. Dan has helped millions of first-time home buyers get educated on mortgages, real estate, and personal finance. Have mortgage questions? Ask Dan in the chat.

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