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

Jordan Rosenfeld

December 3, 2023 at 7:00 PM·8 min read

Shopping for a home can be one of the most exciting-and daunting-milestones in your life. Before you shop for a home, it’s important to find out just how much you can afford to pay for your monthly mortgage payment, which is based upon 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’d owe each month. Depending upon what state you live in, that salary amount can vary 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.

Alabama: $64,163

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

$2,000 Quarter? Check Your Pockets Before You Use This 2004 Coin
I’m a Self-Made Millionaire: Here Are 3 Things I Never Waste Money On

Sponsored: Open a new checking account and earn early paycheck access; up to 2 days early with Discover® Cashback Debit with Early Pay

Alaska: $106,279

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

I’m a Luxury Real Estate Agent: These Are the 5 Home Features That Turn Buyers Away

Arizona: $96,344

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

Arkansas: $60,487

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

California: $148,908

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

Colorado: $111,199

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

I’m a Real Estate Agent: Don’t Rent an Apartment If It Has Any of These 10 Problems

Connecticut: $103,999

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

Delaware: $89,773

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

Florida: $95,979

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

graphiknation / Getty Images/iStockphoto

Georgia: $80,105

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

Learn: 15 Cheapest, Safest Places To Live in the US

Hawaii: $176,010

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

Idaho: $97,916

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

Illinois: $79,065

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

Indiana: $69,677

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

Housing Market 2023: 40 Places Poised for a Housing Crisis

Iowa: $70,093

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

Kansas: $70,204

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

Kentucky: $64,790

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

Louisiana: $63,119

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

Check Out: Grant Cardone Reveals 6 Cities He Would Buy Investment Property in Right Now (and Where He Would Avoid)

Maine: $93,928

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

Maryland: $97,091

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

Massachusetts: $131,536

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

Michigan: $70,928

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

Discover: The Average American Spends This Much on Rent — See How You Stack Up

Jacob Boomsma / Getty Images/iStockphoto

Minnesota: $87,301

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

Mississippi: $59,413

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

Missouri: $69,920

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

Montana: $97,477

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

More: Baby Boomers Transfer Property to Children To Secure Generational Wealth

MidwestWilderness / Getty Images/iStockphoto

Nebraska: $76,661

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

DenisTangneyJr / Getty Images/iStockphoto

Nevada: $98,623

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

New Hampshire: $116,962

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

New Jersey: $117,735

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

I’m a Real Estate Agent: 12 Costly Red Flags I Look For During a Home Inspection

New Mexico: $77,014

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

New York: $101,804

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

North Carolina: $82,358

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

North Dakota: $76,476

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

Could You Afford a Vacation Home in Europe? Check Out the Prices in These 8 Cities

Ohio: $70,976

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

Oklahoma: $63,890

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

Oregon: $114,269

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

Pennsylvania: $78,695

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

Also: 5 Reasons the Housing Market Is Reversing

Rhode Island: $106,613

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

South Carolina: $75,950

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

South Dakota: $79,649

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

Tennessee: $75,947

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

How To Go From Broke in Your 40s to a Millionaire in Your 50s: 8 ‘Late Start’ Retirement Tips

Texas: $83,946

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

Utah: $107,797

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

Vermont: $97,731

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

Virginia: $90,084

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

David Bach: Here’s Why You Should Start Collecting Social Security ASAP

Washington: $123,625

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

West Virginia: $60,980

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

Wisconsin: $82,208

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

Paola Giannoni / Getty Images/iStockphoto

Wyoming: $81,223

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 April 18, 2023.

More From GOBankingRates

This article originally appeared on GOBankingRates.com: This Is the Salary You Need To Afford the Average Home in Your State

Bankrate
How to get a car loan with bad credit
You can still get a car loan with subpar credit without paying sky-high interest.
3h ago
Bankrate
What’s the minimum credit score to buy a car?
There is no minimum credit score, but lenders have varying minimum requirements.
2h ago
Benzinga
If The Average American Household Is A Millionaire With A Net Worth Of $1.06 Million, Why Do People Feel So Broke?
The Federal Reserve’s 2022 consumer finance survey unveils a striking picture of American prosperity, revealing that the mean net worth of the average household has ascended to $1.06 million, a 23% from $868,000 in 2019. This statistic, while impressive, masks a more nuanced and unequal economic landscape. Despite the seemingly thriving financial status of American households, the reality is more complex, particularly for the middle class. The COVID-19 pandemic, which drastically impacted econom
19h ago
Investopedia
30-Year Mortgage Rates Drop to Lowest Level Since the Summer
With another notable fall, rates on 30-year mortgages are now down to their lowest level in almost four months. Most loan averages declined, though refi rates were mixed.
1h ago
Fortune
With the stock market in ‘striking distance’ of all-time high, Wharton’s Jeremy Siegel warns the only thing that can derail it is Jerome Powell
“The primary risk that could knock us off course is a Federal Reserve that remains fixated on inflation fears.”
6h ago
Zacks
Here's Why Cigna (CI) is a Strong Growth Stock
The Zacks Style Scores offers investors a way to easily find top-rated stocks based on their investing style. Here's why you should take advantage.
3h ago
SmartAsset
Ask an Advisor: My Kids Inherited $5 Million. How Should They Handle It?
My children have inherited $5 million of stock from their father (whose estate has not yet been dispersed after 11 months) leaving them with a 30% or so loss of value over which they have had no control. Is there … Continue reading → The post Ask an Advisor: My Kids Inherited $5 Million. How Should They Handle It? appeared first on SmartAsset Blog.
1d ago
Benzinga
Warren Buffett Is Expected To Rake In Over $6 Billion In Dividends In The Next Year - Here Are His 3 Biggest Income-Producing Stocks
Warren Buffett, the venerated investor and CEO of Berkshire Hathaway, is set to amass over $6 billion in dividend income in the coming year, with a significant portion of this windfall emanating from just three stocks. This substantial income stream underscores the effectiveness of Buffett's investment strategy, one that favors profitability and long-term value. Top Dividend Earners in Buffett’s Portfolio Buffett’s predilection for dividend-bearing stocks isn’t just a matter of preference; it’s
1d ago
Benzinga
2024 May Be The Last Year To Take Advantage Of This Huge Tax Break On Pass-Through Income From Real Estate LLCs
No matter who you are or what tax bracket you're in, one thing is true: You want to take advantage of as many legally authorized tax breaks as you can. If you don't act fast, you may lose the opportunity to get a 20% cut on your investment income. Keep reading to find out how you can still take advantage of this tax break and possibly help get it extended in Congress. A Senator, The Tax Cuts And Jobs Act And Real Estate Investments One of the more controversial provisions of the Tax Cuts and Job
21h ago
Reuters
P&G to record up to $2.5 billion in Gillette writedown, operations rejig
The company's shares fell about 2% in early trade. The consumer goods giant said it would take a $1.3 billion non-cash impairment charge before tax in the current quarter ending Dec. 31 on its Gillette business. P&G, which bought Gillette for $57 billion in 2005, gets about 8% of its total sales from the grooming business.
3h ago
The Wall Street Journal
P&G Bought Gillette 18 Years Ago. It’s Still Paying the Price.
Procter & Gamble says it will book $1.3 billion accounting charge on shaving giant it acquired in 2005.
57m ago
SmartAsset
Ask an Advisor: I Have $1 Million and Want It to Work for Me. How Do I Maximize Passive Income and Minimize Taxes?
I have a million dollars and I want to put it to work for me. Where can I put it to make the most amount of passive income from it? Also, how can I minimize taxes on that to be able to keep more of that money? – Andrea While today's high-interest rate environment has […] The post Ask an Advisor: I Have $1 Million and Want It to Work for Me. How Do I Maximize Passive Income and Minimize Taxes? appeared first on SmartReads by SmartAsset.
59m ago
The Wall Street Journal
China’s Colossal Hidden-Debt Problem Is Coming to a Head
Cities and provinces across the country have accumulated a massive amount of hidden debt following years of unchecked borrowing and spending.
9h ago
Investor's Business Daily
Disney Will Pay You To Buy Its Stock Now — But You Can Do Better
Disney is famous for extracting top dollar from its fans' pockets. But now, the S&P 500 company is looking to give money to its shareholders.
1d ago
Investor's Business Daily
15 Dividend Stocks Yielding Up To 4.1% Pay Off Big Time
It's been a rough year for most S&P 500 investors chasing dividends. But there are pockets of dividend paying stocks that are working.
5h ago
SmartAsset
I Want to Convert $500k in My 401(k) to a Roth IRA. How Do I Avoid Paying Taxes?
You can't avoid taxes when making a Roth IRA conversion, but there are strategies to reduce your tax burden if the circumstances are right. When you convert money from a pre-tax account, such as a 401(k) or an IRA, to a post-tax Roth IRA, you must pay income taxes on the full value of the […] The post I Want to Convert $500k in My 401(k) to a Roth IRA. How Do I Avoid Paying Taxes? appeared first on SmartReads by SmartAsset.
1d ago
The Wall Street Journal
AT&T’s Ericsson Supply Deal Isn’t ‘Secret Sauce’ for Easing Costs, CEO Says
AT&T's new [$14 billion supply deal with Ericsson](https://www.wsj.com/business/telecom/at-t-signs-14-billion-supply-deal-with-ericsson-e0d870dd) could save money but won't give the cellphone carrier a "secret sauce" for thinning out expenses, its CEO said Tuesday. Speaking to a UBS investor conference, CEO John Stankey said "capital intensity" should still fall between $21 billion and $22 billion next year, suggesting that Ericsson savings will cover other spending priorities, like improving wireless coverage and building fiber-optic cables. The new, five-year, deal will move AT&T away from Nokia equipment in many markets.
19m ago
Fox Business
JPMorgan predicts a grim outlook for the stock market next year
JPMorgan Chase analysts warned in a new note to clients that the stock market faces more pain in 2024, projecting the S&P 500 will fall 8% by year's end.
20h ago
Yahoo Finance
Homebuyers are 'losing patience,' no longer on the sidelines: survey
Potential homebuyers are no longer waiting for mortgage rates or home prices to drop before they buy, according to Bank of America’s Homebuyers Insight Report.
19h ago
SmartAsset
My Husband and I Are in Our 50s, Have $1 Million in Our 401(k)s and Want to Retire at 65. Should We Switch to Roth Contributions?
Should you make 401(k) or Roth IRA contributions? In a perfect world, the answer would be both. If you have the means, maximizing your traditional 401(k) and Roth contributions is a great way to build a diversified set of retirement savings. But, of course, your paycheck gets a vote. So, if you have to choose, […] The post My Husband and I Are in Our 50s, Have $1 Million in Our 401(k)s and Want to Retire at 65. Should We Switch to Roth Contributions? appeared first on SmartReads by SmartAsset.
5h ago