For many, homeownership is the ultimate realization of the American Dream. Though often expensive up front, buying a home is one of the best and most practical ways to build wealth, as real estate tends to appreciate in value and homeowners benefit from several tax deductions.
While buying a home is one of the best investments anyone can make, it is not within everyone’s reach. Today, the U.S. homeownership rate — or the share of housing units occupied by their owners — stands at about 64%, down from an all time high of more than 69% leading up to the housing bubble that had a role in bringing about the global financial crisis.
Homeownership rates are also not the same across all states. In some parts of the country, nearly three-quarters of housing units are owner-occupied, while in others only about half are. To determine the states with the highest (and lowest) homeownership rates, 24/7 Wall St. reviewed data on the percentage of occupied housing units that are occupied by their owners from the U.S. Census Bureau’s 2018 U.S. Census Bureau’s American Community Survey. The median value of owner-occupied homes, the percentage of owner-occupied housing units with a mortgage, the median monthly housing costs for owner-occupied housing units with a mortgage, and median household income for all units also came from the 2018 ACS. States are ranked from the lowest homeownership rate to the highest.
Homeownership is closely tied to housing costs, and in states where housing costs are higher and housing is less affordable, homeownership rates tend to be lower. In eight of the 10 states with the lowest homeownership rates, the median monthly housing costs for houses with a mortgage is higher than $1,566 — the national median.
Even though the population is wealthier in most of these states, the higher incomes are not enough to compensate for higher housing costs. Here is a look at America’s 25 least affordable housing markets.
One of the primary determinants of home value and price, in addition to location, is the size of the property and square footage of the home. While within a given real estate market larger homes are generally more expensive, in some parts of the country, larger homes are far more affordable than in others. A very small apartment in Manhattan can be far more expensive than a McMansion in Indiana. Here is a look at how much home you can buy for $200,000 in each state.