Home prices continue to reach new highs across the nation, but research has pinpointed the states that remain more affordable than the rest — despite their own rising prices.
The data team at Realtor.com recently identified the top 10 states with the most affordable homes in the nation, based on median home list prices from April.
While existing-home sales were down for the fourth consecutive month in May, according to a report from the National Association of Realtors, the median existing-home sales price exceeded $400,000 for the first time.
According to the report, this is a 14.8% increase from a year ago.
NAR chief economist Lawrence Yun said home sales have essentially returned to pre-pandemic levels, but until inventory “almost doubles,” home price appreciation will continue.
As a result, eager buyers seeking a home within their budget may find it helpful to look beyond their current towns and into a more affordable region, experts say.
George Ratiu, manager of economic research for Realtor.com, said that although many of the states on the list are more rural and don’t have as many large cities, they offer more natural, outdoor attractions that became popular during the COVID-19 pandemic.
They also have experienced their own economic growth and stronger job opportunities.
The most affordable areas are generally in the Midwest or South, where labor is often cheaper, there may be fewer building regulations, and property taxes are often lower, Ratiu said.
Here are the top 10 most affordable states for homebuyers, with their median list price:
- West Virginia, $199,000
- Ohio, $215,000
- Arkansas, $245,000
- Kansas, $248,500
- Oklahoma, $250,000
- Mississippi, $258,000
- Michigan, $259,000
- Indiana, $260,000
- Kentucky, $260,000
- Missouri, $270,000
For those not interested in moving too far from where they are now, market experts say homebuying has always been more about a buyer’s personal financial situation, rather than national averages.
Additionally, there are likely to be affordable areas within each state, no matter if they fall in the top 10.
Experts say the best way to approach homebuying while prices continue to rise is to connect with local real estate agents and mortgage lenders in the location of choice.
These experts will be able to pinpoint areas within a borrower’s own budget, and help the borrower find a loan option that works for them.
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