We all know that home prices are skyrocketing and the cost of living in some areas is significantly more expensive than other areas. With other financial burdens such as student loans and medical care, home ownership is out of reach for many young adults. Some states have such costly homes that we can’t believe anyone can afford one at all! Let’s take a look at some of those states below.
Have you ever wondered what the most expensive state to purchase a home is? Curiosity got the best of us, and we decided to do a little research and find out the 5 states with the highest home prices. Check out our findings below.
We took a look at the median home value per state to determine which state had the highest house prices. These were the top five most expensive states:
- Hawaii
- Washington D.C.
- California
- Massachusetts
- Colorado
1. Hawaii
The Median Home Price in Hawaii is $635,000 making it the most expensive state to buy a house in. That’s a median price per square foot of $521. We hope you’re not dreaming of moving there anytime soon.
2. Washington D.C.
The median home price in Washington D.C. is $599,000, with a median price per square foot of $547. Who would have thought living in the capital would be so expensive?
3. California
Okay, we all knew this would be somewhere near the top. We’ve all heard of the crazy home prices in Cali. Median home price $549,900. Median price per square foot: $324. We all know everyone’s thought of moving to California at least once, well think again. That price is out of reach for most people.
4. Massachusetts
Have you ever heard of anyone dreaming to move to…..Massachusetts? Me neither. Median home price: $479, 900, Median price per square foot: $271
5. Colorado
Colorado is number five on the most expensive list with a median home price of $429,800 and median price per square foot of $260.
If you’re interested in finding out the prices of homes in all of the other 45 states you can check out the full article where we got our information from.
Why Are Home Costs So High In Some States?
- Not Enough Houses
- Housing Demand
- House Building Costs
Not Enough Houses
California, for example, hasn’t built enough homes, so there isn’t enough houses on the market to keep up with demand. Some states like California it is a hard process to get approved to build new housing, and so there isn’t much incentive to. Getting new housing approved can be expensive because of environmental laws and growth regulations. Which is another reason there isn’t enough houses on the market.
Housing Demand
Demand to work and live in places like Hawaii and California is so high that there isn’t a lot of homes on the market. Seriously, people from not only the United States, but all over the country are wanting to move there, and there isn’t enough homes for everyone. When you have a flood of people wanting to live in one area, and not enough houses to satisfy the demand, naturally the home prices increase.
Home Building Costs
Land, labor, and the cost of materials is another reason some states have extremely high housing costs. Some states it’s just more expensive for all of these things which naturally pushes the cost of housing up.
Why Housings Costs Are Going Up
The problem with high housing costs isn’t just a problem in the five states we’ve mentioned, it’s a problem in the majority of states. Housing costs heavy been steadily rising in recent years. With the housing marketing currently being ultra competitive.
But what is the reasoning behind these high costs? Many in the real estate industry will claim that because of zoning laws and regulations we just haven’t built enough homes to keep up with demand, which is the reason for the drastically rising prices. I mean, it makes sense right? Home ownership is part of the american dream? Though this doesn’t get into landlord taxes and mortgage policies, which definitely also influences how prices. But we won’t get into that now.
Salary Needed to Afford A Home in the Five Most Expensive States
Now that we’ve examined the top five most expensive states for homeownership, and covered some reasons that prices are increasing, to put things into perspective, and to close out this article, let’s take a look at the salary needed to afford the average home in the five states we previously mentioned.
Hawaii: To afford the average home in the state of hawaii you to need make yearly salary of about $153000. Wow! That’s a lot of money. Hopefully if you’re thinking of moving to Hawaii you are either a doctor, or work in the tech industry.
Washington D.C.: To afford the average home in Washington D.C. (okay, technically not a state, we know) you need a yearly salary of roughly $138,400. Yeah, i’m definitely not moving there anytime soon.
California: In everyone’s favorite state you would need a yearly salary of approximately $120,100 to reasonably afford the average home. Are you planning to move Hollywood anytime soon?
Massachusetts: If you want to buy a home in a state that I’m not really sure why anyone would want to live in, you need a yearly salary of about $101,300.
Colorado: Last but not least, Colorado, a state that actually sounds nice to live in, if you’re not planning on buying a home that is. In Colorado you will need a yearly salary of about $100,200 to afford the average home.
If you want to check out the yearly salary needed to afford at home in the other 45 states you can check out this resource here :https://www.fatherly.com/news/map-average-cost-house-each-state-us/
