The 11 Affordable States Where Buyers Can Avoid Going House-Poor

Elevated mortgage rates and high home prices continue to squeeze budget buyers, but 11 states— mostly nestled in the American heartland—stand out as bastions of affordability this year. 

A household earning a median income can comfortably afford a median-priced home in fewer than a quarter of the 50 states and the District of Columbia, according to the 2026 Realtor.com® Housing Report Card.

Personal finance experts typically recommend spending no more than 30% of gross monthly income on housing to avoid becoming cost-burdened, in what is known as the “30% rule.”

While high borrowing costs and economic headwinds have recently put this guidance to the test, the math still works in Iowa, Illinois, Ohio, Kansas, Indiana, Michigan, Pennsylvania, West Virginia, Missouri, Maryland, and Minnesota.

For the report card, all 50 states and DC were ranked on a 100-point scale based on two criteria carrying equal weight: housing affordability and homebuilding. 

Affordability, which accounts for half of the final score, measures how accessible homeownership is for typical earners and takes into account the REALTORS® Affordability Score.

The remaining 50% is determined by homebuilding activity, which evaluates whether a state produces enough new homes to meet demand.

Midwestern hub of affordability

When it comes to pure affordability, Iowa is the undisputed leader, requiring homebuyers to spend just 25.4% of their earnings to afford the median home price of $282,886, the lowest share in the U.S.

Unsurprisingly, Iowa clinched the No. 2 spot in this year’s rankings, earning an overall A grade and a REALTORS® Affordability Score of 0.96—the highest of any state.

Iowa Realtors statewide housing analyst Les Sulgrove says the secret to the Hawkeye State’s success is its even-keeled market.

“Iowa has maintained exceptional affordability because statewide median home prices have grown at a slow, predictable pace in line with local wages,” Sulgrove tells Realtor.com. “This stability has shielded the state from the volatile, speculative price swings often seen in major national metro areas.”

To protect its affordability, Iowa relies on state laws that cut through municipal red tape and fast-track new construction.

Sulgrove points to recent legislation that has limited the ability of local governments to block high-density housing options, allowing developers to maintain robust building activity and steadily increase supply.

However, even Iowa is not immune to housing challenges. The state’s greatest weakness is its relatively modest permitting activity, according to Realtor.com senior economist Joel Berner.

Additionally, newly built homes in Iowa carry a 56% premium over existing listings, suggesting that developers are focused on larger, more expensive options rather than entry-level inventory.

Sulgrove notes that subdued consumer confidence also presents a challenge.

“True to form with most Iowans, we are a cautious community and fiscally conservative,” says the analyst. “While affordability is strong, many people on the buying or selling side watch economic and national issues, and tend to step back into a holding pattern. We love stability.”

Sulgrove predicts that if mortgage rates move closer to the low 6% and the conflict in the Middle East is resolved, more buyers and sellers will jump back into the market.

Other budget-friendly markets

Following Iowa, Illinois clinched the No. 2 spot in affordability, with the median-priced home eating up just 26% of a median household income, with Ohio coming in third and Kansas fourth, both with 27%.

Kansas’ impressive affordability helped propel it from No. 20 last year to No. 13 this year, earning the state a B grade. 

Indiana, which tops the 2026 leaderboard with an A and an overall score of 76.3 out of 100, is also the fifth most affordable state in the nation. A median income-earning household there spends just 28.3% of its earnings on housing.

Rick Wajda, CEO of the Indiana Builders Association, tells Realtor.com that the state’s impressive affordability has long been attracting transplants from pricier markets—an influx requiring accelerated construction and denser housing.

“Our members are working every day to try to meet the needs of a growing economy by making sure we have adequate housing available,” says Wajda.

That entails working with municipal leaders and homeowners in the NIMBY (“not in my backyard”) camp to embrace more development.

According to Wajda, the ultimate goal is to “continue to make Indiana the shining star in the Midwest, and continue to provide affordable housing options for consumers that want to move to Indiana and consumers in the state of Indiana that are looking to buy a house.”

National affordability crisis persists

Among the rest of the states on the most affordable list, the majority are located in the middle of the country and have median listing prices below the national median of $429,500 in May.

“These low housing costs combined with relatively strong incomes lead these 11 states to the desirable outcome of their median home listing being affordable to the median purchaser using the 30% rule,” says Berner.

However, housing costs exceed the 30% threshold in 40 of the 50 states and DC—a problem Berner identifies as a structural issue that won’t go away even if borrowing costs plummet.

“Lower mortgage rates would help affordability across the board, but most states would still struggle with affordability because of their high housing costs relative to incomes,” says Berner.

Looking ahead, the economist forecasts that nine of the 11 most affordable states will see their budget-friendly status erode unless they aggressively increase homebuilding. The only exceptions are Iowa and Indiana, which maintain strong permitting activity.