The first two years of the coronavirus pandemic had a profound impact on the U.S. housing market as Americans fled expensive, high-population areas to mid-sized cities or adjoining suburbs in lower-cost parts of the country. (See how the cost of housing has skyrocketed in these major U.S. cities.)
Low-mortgage rates and high demand for homes in many markets — coupled with a slowdown in new home construction due to pandemic-related disruptions in the labor force and supply chains — often led to intense bidding wars over available homes among prospective buyers.
How the times have changed.
The once piping hot U.S. residential real estate market has slowed considerably in 2023.
Rising interest rates and an unwillingness by potential sellers to give up their low-rate mortgages have chilled the home-buying frenzy of the previous two years.
Even in hot, high-cost markets like Austin, Texas, and San Francisco home prices have dropped by 10% over the past year, according to a Washington Post analysis of home value data.
But if you still cannot afford an Austin-area suburban McMansion or a townhouse in San Francisco’s Mission District – and you do not mind the life and pace of a smaller, less popular place – buying a home is within reach for people with even modest incomes in some cities.
To identify the cheapest city to buy a home in every state, 24/7 Wall St. reviewed data on median list price of homes on the market in April 2023 with data from realtor.com, a real estate market website. With median list price data for over 900 U.S. metro areas, we identified the city in each state with the lowest median list price.
Median list price among the 50 cities and towns – each the cheapest in its state to buy a home – ranges from $55,000 in Clarksdale, Mississippi, to $645,000 in Hilo, Hawaii. All but two of the cities on the list have median list prices cheaper than the national median of $430,000 in April 2023.
In 18 of the cities, the list price declined compared to April last year, and in all but one city the median list price is lower than the state media. In Providence-Warwick, Rhode Island, which is listed here by default only as it is the only city with data in the state, the median list price is $529,900, more than the median in Rhode Island of $525,500.
In 26 cities, the median list price is less than half the median price statewide, with the median in Olean, New York, not even 20% of the median across New York state, at $125,000 and $639,945, respectively. Though these cities have the cheapest list price in their state, in the vast majority, these median prices fetch smaller homes than the median prices statewide would. Here is how much home you can buy for $200k in each state.
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