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Chances are you’ve considered how much money you would need to earn in order to buy a home. The answer, of course, depends largely on where you live. To give you an idea, finance website HowMuch.net recently crunched the housing affordability numbers for each state to ensure you spend your money wisely.
To arrive at its estimates, the website layered in several factors. The team collected average home prices in every state from Zillow, then plugged those figures into a mortgage calculator to determine monthly payments. HowMuch.net considered an interest rate that varied between 4 and 5 percent in each state. Also, it was assumed buyers were contributing a 10-percent down payment.
Given that many financial advisors recommend the total cost of housing take up no more than 30 percent of gross income (i.e. the amount before taxes, retirement savings, etc.), the data team used that rule as a benchmark to calculate the minimum salary needed to afford the average home in each state. The figures are based on 30-year mortgages.
Next, we took HowMuch.net’s findings a step further by including the latest U.S. Census Bureau data on median household income to help illustrate how affordable a home purchase may actually be for the average person living in that state.
Ready to see how your state fares when it comes to affordability and home prices?
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Alabama
Salary needed to afford a home: $47,960
Median household income: $46,257
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Alaska
Salary needed to afford a home: $67,280
Median household income: $76,440
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Arizona
Salary needed to afford a home: $67,280
Median household income: $53,558
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Arkansas
Salary needed to afford a home: $41,040
Median household income: $44,334
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California
Salary needed to afford a home: $120,120
Median household income: $67,739
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Colorado
Salary needed to afford a home: $100,200
Median household income: $65,685
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Connecticut
Salary needed to afford a home: $75,280
Median household income: $73,433
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Delaware
Salary needed to afford a home: $67,960
Median household income: $61,757
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Washington, DC
Salary needed to afford a home: $138,440
Median household income: $75,506
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Florida
Salary needed to afford a home: $70,360
Median household income: $50,860
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Georgia
Salary needed to afford a home: $59,520
Median household income: $53,559
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Hawaii
Salary needed to afford a home: $153,520
Median household income: $74,511
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Idaho
Salary needed to afford a home: $70,360
Median household income: $51,807
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Illinois
Salary needed to afford a home: $53,880
Median household income: $60,960
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Indiana
Salary needed to afford a home: $42,560
Median household income: $52,314
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Iowa
Salary needed to afford a home: $44,360
Median household income: $56,247
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Kansas
Salary needed to afford a home: $43,160
Median household income: $54,935
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Kentucky
Salary needed to afford a home: $44,360
Median household income: $46,659
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Louisiana
Salary needed to afford a home: $50,320
Median household income: $45,146
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Maine
Salary needed to afford a home: $55,520
Median household income: $53,079
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Maryland
Salary needed to afford a home: $72,200
Median household income: $78,945
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Massachusetts
Salary needed to afford a home: $101,320
Median household income: $75,297
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Michigan
Salary needed to afford a home: $40,800
Median household income: $52,492
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Minnesota
Salary needed to afford a home: $64,720
Median household income: $65,599
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Mississippi
Salary needed to afford a home: $44,360
Median household income: $41,754
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Missouri
Salary needed to afford a home: $42,200
Median household income: $51,746
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Montana
Salary needed to afford a home: $75,520
Median household income: $50,027
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Nebraska
Salary needed to afford a home: $51,520
Median household income: $56,927
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Nevada
Salary needed to afford a home: $73,120
Median household income: $55,180
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New Hampshire
Salary needed to afford a home: $68,440
Median household income: $70,936
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New Jersey
Salary needed to afford a home: $69,640
Median household income: $76,126
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New Mexico
Salary needed to afford a home: $54,880
Median household income: $46,748
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New York
Salary needed to afford a home: $91,720
Median household income: $62,909
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North Carolina
Salary needed to afford a home: $63,840
Median household income: $50,584
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North Dakota
Salary needed to afford a home: $56,000
Median household income: $60,656
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Ohio
Salary needed to afford a home: $38,400
Median household income: $52,334
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Oklahoma
Salary needed to afford a home: $45,320
Median household income: $49,176
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Oregon
Salary needed to afford a home: $87,160
Median household income: $57,532
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Pennsylvania
Salary needed to afford a home: $47,960
Median household income: $56,907
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Rhode Island
Salary needed to afford a home: $69,640
Median household income: $60,596
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South Carolina
Salary needed to afford a home: $58,840
Median household income: $49,501
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South Dakota
Salary needed to afford a home: $55,360
Median household income: $54,467
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Tennessee
Salary needed to afford a home: $55,760
Median household income: $48,547
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Texas
Salary needed to afford a home: $66,080
Median household income: $56,565
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Utah
Salary needed to afford a home: $83,720
Median household income: $65,977
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Vermont
Salary needed to afford a home: $62,600
Median household income: $57,677
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Virginia
Salary needed to afford a home: $71,960
Median household income: $68,114
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Washington
Salary needed to afford a home: $87,040
Median household income: $67,106
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West Virginia
Salary needed to afford a home: $38,320
Median household income: $43,385
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Wisconsin
Salary needed to afford a home: $50,080
Median household income: $56,811
Image Credit: DepositPhotos.com.
Wyoming
Salary needed to afford a home: $58,000
Median household income: $59,882
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