This Is the Salary You Need To Afford the Average Home in Your State

Shopping for a home can be one of the most exciting and daunting life milestones. Before you shop for homes, it’s important to understand which mortgage rates are best and how much of a monthly payment you can afford. Both are based on how much income you make.

Visiting a lender to get prequalified for a home loan is one of the first things you should do to learn the amount you might be eligible to borrow and the amount you owe each month. Depending on the state, that salary amount varies quite widely.

For example, you only need to earn about $60,500 in Arkansas to buy an average home, whereas you’d have to earn almost $176,000 to afford one in Hawaii.

For you to own a home, and live comfortably, some financial experts recommend your housing costs — primarily your mortgage payments — shouldn’t consume more than 30% of your monthly income. With this rule of thumb in mind, GOBankingRates looked at home prices and mortgage rates in every state and estimated the minimum salary needed to afford the average home. Keep reading to find out what the cost of housing looks like in your home state.

• 2023 average home value: $201,212
• Monthly mortgage payment: $1,058.61
• Annual mortgage payments: $12,703

• 2023 average home value: $357,035
• Monthly mortgage payment: $2,065.86
• Annual mortgage payments: $24,790

• 2023 average home value: $420,605
• Monthly mortgage payment: $2,304.00
• Annual mortgage payments: $27,648

• 2023 average home value: $176,107
• Monthly mortgage payment: $963.21
• Annual mortgage payments: $11,559

• 2023 average home value: $748,161
• Monthly mortgage payment: $4,148.16
• Annual mortgage payments: $49,778

• 2023 average home value: $552,779
• Monthly mortgage payment: $2,977.35
• Annual mortgage payments: $35,728

• 2023 average home value: $379,101
• Monthly mortgage payment: $2,427.31
• Annual mortgage payments: $29,128

• 2023 average home value: $355,120
• Monthly mortgage payment: $1,927.53
• Annual mortgage payments: $23,130

• 2023 average home value: $398,861
• Monthly mortgage payment: $2,271.31
• Annual mortgage payments: $27,256

• 2023 average home value: $307,375
• Monthly mortgage payment: $1,750.34
• Annual mortgage payments: $21,004

• 2023 average home value: $971,526
• Monthly mortgage payment: $5,046.57
• Annual mortgage payments: $60,559

• 2023 average home value: $438,088
• Monthly mortgage payment: $2,418.02
• Annual mortgage payments: $29,016

• 2023 average home value: $239,065
• Monthly mortgage payment: $1,588.47
• Annual mortgage payments: $19,062

• 2023 average home value: $221,357
• Monthly mortgage payment: $1,247.60
• Annual mortgage payments: $14,971

• 2023 average home value: $201,546
• Monthly mortgage payment: $1,246.79
• Annual mortgage payments: $14,961

• 2023 average home value: $208,883
• Monthly mortgage payment: $1,260.85
• Annual mortgage payments: $15,130

• 2023 average home value: $188,438
• Monthly mortgage payment: $1,058.92
• Annual mortgage payments: $12,707

• 2023 average home value: $182,124
• Monthly mortgage payment: $980.95
• Annual mortgage payments: $11,771

• 2023 average home value: $347,071
• Monthly mortgage payment: $2,074.73
• Annual mortgage payments: $24,897

• 2023 average home value: $395,518
• Monthly mortgage payment: $2,295.12
• Annual mortgage payments: $27,541

• 2023 average home value: $576,102
• Monthly mortgage payment: $3,391.02
• Annual mortgage payments: $40,692

• 2023 average home value: $212,868
• Monthly mortgage payment: $1,295.55
• Annual mortgage payments: $15,547

• 2023 average home value: $320,005
• Monthly mortgage payment: $1,872.93
• Annual mortgage payments: $22,475

• 2023 average home value: $160,346
• Monthly mortgage payment: $878.35
• Annual mortgage payments: $10,540

• 2023 average home value: $226,968
• Monthly mortgage payment: $1,307.60
• Annual mortgage payments: $15,691

• 2023 average home value: $427,218
• Monthly mortgage payment: $2,375.82
• Annual mortgage payments: $28,510

• 2023 average home value: $242,560
• Monthly mortgage payment: $1,522.75
• Annual mortgage payments: $18,273

• 2023 average home value: $429,767
• Monthly mortgage payment: $2,336.28
• Annual mortgage payments: $28,035

• 2023 average home value: $442,930
• Monthly mortgage payment: $2,909.82
• Annual mortgage payments: $34,918

• 2023 average home value: $460,761
• Monthly mortgage payment: $3,122.95
• Annual mortgage payments: $37,475

• 2023 average home value: $280,010
• Monthly mortgage payment: $1,536.17
• Annual mortgage payments: $18,434

• 2023 average home value: $396,058
• Monthly mortgage payment: $2,410.47
• Annual mortgage payments: $28,926

• 2023 average home value: $309,902
• Monthly mortgage payment: $1,741.49
• Annual mortgage payments: $20,898

• 2023 average home value: $245,226
• Monthly mortgage payment: $1,404.61
• Annual mortgage payments: $16,855

• 2023 average home value: $206,508
• Monthly mortgage payment: $1,291.26
• Annual mortgage payments: $15,495

• 2023 average home value: $189,085
• Monthly mortgage payment: $1,072.01
• Annual mortgage payments: $12,864

• 2023 average home value: $491,744
• Monthly mortgage payment: $2,812.52
• Annual mortgage payments: $33,750

• 2023 average home value: $243,386
• Monthly mortgage payment: $1,503.60
• Annual mortgage payments: $18,043

• 2023 average home value: $421,742
• Monthly mortgage payment: $2,584.36
• Annual mortgage payments: $31,012

• 2023 average home value: $272,103
• Monthly mortgage payment: $1,470.12
• Annual mortgage payments: $17,641

• 2023 average home value: $283,596
• Monthly mortgage payment: $1,678.74
• Annual mortgage payments: $20,145

• 2023 average home value: $287,793
• Monthly mortgage payment: $1,583.67
• Annual mortgage payments: $19,004

• 2023 average home value: $296,285
• Monthly mortgage payment: $1,872.37
• Annual mortgage payments: $22,468

• 2023 average home value: $515,621
• Monthly mortgage payment: $2,798.69
• Annual mortgage payments: $33,584

• 2023 average home value: $327,908
• Monthly mortgage payment: $2,115.93
• Annual mortgage payments: $25,391

• 2023 average home value: $363,186
• Monthly mortgage payment: $2,056.05
• Annual mortgage payments: $24,673

• 2023 average home value: $577,876
• Monthly mortgage payment: $3,276.26
• Annual mortgage payments: $39,315

• 2023 average home value: $145,893
• Monthly mortgage payment: $787.02
• Annual mortgage payments: $9,444

• 2023 average home value: $262,566
• Monthly mortgage payment: $1,652.71
• Annual mortgage payments: $19,833

• 2023 average home value: $322,509
• Monthly mortgage payment: $1,742.46
• Annual mortgage payments: $20,910

Jami Farkas and Laura Beck contributed to the reporting for this article.

Methodology: For this piece, GOBankingRates first surveyed monthly living expenses in all 50 states. The cost-of-living comparison included the following factors: (1) yearly mortgage by assuming 20% down payment, 30-year fixed loan, current interest rate as sourced from St. Louis Federal Reserve (6.27%) for every state and multiplying that by 12 (1 year), sourced from Zillow’s home value index and determined using CNET Mortgage Calculator formula; (2) annual necessities cost (grocery, utilities, healthcare, and transportation) by taking the 2021 Bureau of Labor Statistics consumer expenditure survey and factored out by the Missouri Economic Research and Information Center’s cost of living index for all of 2022. Necessity costs were totaled using the annual dollar cost of necessities in each state. This dollar amount for necessities was then doubled to find the (3) actual annual income needed to live comfortably in the state, assuming a person is following the 50-30-20 budgeting guideline, which requires an income double the cost of necessities. The amount of money specified for savings is equal to 20% of the total income needed, and the amount specified for discretionary spending is equal to 30% of the total income needed. All data was collected on and is up to date as of May 10, 2024.