This Is the Salary You Need To Afford the Average Home in Your State
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. 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.
Read: Tips To Get Your Mortgage Payments as Low as Possible
See: 32 Insider Tips for Buying and Selling a House
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.
Alabama: $51,718
2021 average home value: $168,427
Monthly mortgage payment: $626.57
Annual mortgage payments: $7,519
Alaska: $85,592
2021 average home value: $316,130
Monthly mortgage payment: $1,336.74
Annual mortgage payments: $16,041
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Arizona: $72,124
2021 average home value: $354,142
Monthly mortgage payment: $1,385.33
Annual mortgage payments: $16,624
Arkansas: $48,443
2021 average home value: $147,986
Monthly mortgage payment: $580.12
Annual mortgage payments: $6,961
California: $111,904
2021 average home value: $678,107
Monthly mortgage payment: $2,709.12
Annual mortgage payments: $32,509
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Colorado: $83,376
2021 average home value: $490,848
Monthly mortgage payment: $1,887.37
Annual mortgage payments: $22,648
Connecticut: $82,391
2021 average home value: $329,114
Monthly mortgage payment: $1,597.34
Annual mortgage payments: $19,168
Delaware: $69,655
2021 average home value: $301,343
Monthly mortgage payment: $1,176.28
Annual mortgage payments: $14,115
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Florida: $70,335
2021 average home value: $307,903
Monthly mortgage payment: $1,271.16
Annual mortgage payments: $15,254
Georgia: $60,699
2021 average home value: $243,681
Monthly mortgage payment: $1,008.06
Annual mortgage payments: $12,097
Hawaii: $129,604
2021 average home value: $824,769
Monthly mortgage payment: $3,027.00
Annual mortgage payments: $36,324
Idaho: $74,118
2021 average home value: $394,381
Monthly mortgage payment: $1,559.17
Annual mortgage payments: $18,710
Illinois: $66,753
2021 average home value: $231,696
Monthly mortgage payment: $1,170.86
Annual mortgage payments: $14,050
Indiana: $54,909
2021 average home value: $184,258
Monthly mortgage payment: $753.02
Annual mortgage payments: $9,036
Iowa: $56,450
2021 average home value: $166,243
Monthly mortgage payment: $765.29
Annual mortgage payments: $9,184
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Kansas: $56,429
2021 average home value: $176,666
Monthly mortgage payment: $791.19
Annual mortgage payments: $9,494
Kentucky: $52,761
2021 average home value: $167,627
Monthly mortgage payment: $680.87
Annual mortgage payments: $8,170
Louisiana: $53,766
2021 average home value: $188,748
Monthly mortgage payment: $724.19
Annual mortgage payments: $8,690
Maine: $72,317
2021 average home value: $296,130
Monthly mortgage payment: $1,306.46
Annual mortgage payments: $15,678
Maryland: $77,288
2021 average home value: $370,235
Monthly mortgage payment: $1,574.78
Annual mortgage payments: $18,897
Massachusetts: $98,246
2021 average home value: $521,346
Monthly mortgage payment: $2,247.93
Annual mortgage payments: $26,975
See: The Cost To Own a 3-Bedroom Home in Every State
Michigan: $59,731
2021 average home value: $202,476
Monthly mortgage payment: $911.84
Annual mortgage payments: $10,942
Minnesota: $70,724
2021 average home value: $299,030
Monthly mortgage payment: $1,281.88
Annual mortgage payments: $15,383
Mississippi: $47,703
2021 average home value: $140,039
Monthly mortgage payment: $551.30
Annual mortgage payments: $6,616
Missouri: $56,137
2021 average home value: $193,310
Monthly mortgage payment: $814.18
Annual mortgage payments: $9,770
The Opposite: States Where You’re Most Likely To Live Paycheck to Paycheck
Montana: $71,113
2021 average home value: $350,020
Monthly mortgage payment: $1,410.04
Annual mortgage payments: $16,920
Nebraska: $60,462
2021 average home value: $204,861
Monthly mortgage payment: $961.85
Annual mortgage payments: $11,542
Nevada: $75,566
2021 average home value: $375,203
Monthly mortgage payment: $1,455.21
Annual mortgage payments: $17,462
New Hampshire: $85,567
2021 average home value: $373,429
Monthly mortgage payment: $1,862.21
Annual mortgage payments: $22,347
New Jersey: $91,228
2021 average home value: $411,255
Monthly mortgage payment: $2,133.09
Annual mortgage payments: $25,597
New Mexico: $59,438
2021 average home value: $242,693
Monthly mortgage payment: $947.34
Annual mortgage payments: $11,368
New York: $76,172
2021 average home value: $320,388
Monthly mortgage payment: $1,440.18
Annual mortgage payments: $17,282
North Carolina: $63,064
2021 average home value: $248,242
Monthly mortgage payment: $1,008.31
Annual mortgage payments: $12,100
North Dakota: $65,300
2021 average home value: $254,062
Monthly mortgage payment: $1,053.12
Annual mortgage payments: $12,637
See: What You Can Rent on a Minimum-Wage Salary in Every State
Ohio: $48,015
2021 average home value: $181,096
Monthly mortgage payment: $847.25
Annual mortgage payments: $10,167
Oklahoma: $51,369
2021 average home value: $150,685
Monthly mortgage payment: $618.33
Annual mortgage payments: $7,420
Oregon: $87,735
2021 average home value: $447,716
Monthly mortgage payment: $1,867.03
Annual mortgage payments: $22,404
Pennsylvania: $66,367
2021 average home value: $232,273
Monthly mortgage payment: $1,069.26
Annual mortgage payments: $12,831
Rhode Island: $83,980
2021 average home value: $373,101
Monthly mortgage payment: $1,698.90
Annual mortgage payments: $20,387
South Carolina: $59,798
2021 average home value: $227,993
Monthly mortgage payment: $878.56
Annual mortgage payments: $10,543
South Dakota: $61,827
2021 average home value: $241,877
Monthly mortgage payment: $1,055.02
Annual mortgage payments: $12,660
Read: What Homes Will Be Worth in Your State by the End of 2021
Tennessee: $56,724
2021 average home value: $229,299
Monthly mortgage payment: $902.70
Annual mortgage payments: $10,832
Texas: $64,429
2021 average home value: $244,605
Monthly mortgage payment: $1,160.68
Annual mortgage payments: $13,928
Utah: $80,369
2021 average home value: $461,136
Monthly mortgage payment: $1,788.50
Annual mortgage payments: $21,462
Vermont: $78,258
2021 average home value: $301,615
Monthly mortgage payment: $1,471.42
Annual mortgage payments: $17,657
Virginia: $69,680
2021 average home value: $329,631
Monthly mortgage payment: $1,355.37
Annual mortgage payments: $16,264
Washington: $94,136
2021 average home value: $517,839
Monthly mortgage payment: $2,129.24
Annual mortgage payments: $25,551
West Virginia: $46,582
2021 average home value: $115,898
Monthly mortgage payment: $446.61
Annual mortgage payments: $5,359
Beware: The Opposite: States Where You’re Most Likely To Live Paycheck to Paycheck
Wisconsin: $65,065
2021 average home value: $230,729
Monthly mortgage payment: $1,081.38
Annual mortgage payments: $12,977
Wyoming: $62,351
2021 average home value: $273,483
Monthly mortgage payment: $1,049.30
Annual mortgage payments: $12,592
More From GOBankingRates
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 (3.09%) for every state and multiplying that by 12 (one 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 2020 Bureau of Labor Statistics consumer expenditure survey and factored out by the Missouri Economic Research and Information Center’s cost-of-living index for quarter 2 of 2021. Necessity costs were totaled to find 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 and is up to date as of Oct. 25, 2021.
Last updated: Nov. 2, 2021
This article originally appeared on GOBankingRates.com: This Is the Salary You Need To Afford the Average Home in Your State
