Key takeaways
- California, Montana, and New York are the most expensive states in the U.S., where monthly housing payments eat up nearly half of a local homebuyer’s income.
- Most of the priciest states are located on the coasts; limited inventory and higher incomes have pushed prices to all-time highs.
- Housing affordability is a major issue for everyone—one reason why the market has been so slow—but is slowly improving
Housing has become increasingly expensive for Americans since the pandemic. Home prices have climbed by more than 50%, and mortgage rates have nearly doubled, pushing the typical housing payment to ever-climbing highs. An average homebuyer needs to spend nearly 40% of their income on housing today, according to Redfin data. This has exacerbated a housing crisis and pushed more people into a cool but expensive rental market—where many now aim to stay.
These rising living expenses have been a major reason why people have been migrating to more affordable parts of the country of late. Areas in the Sun Belt, Midwest, and Northeast have blossomed, while coastal cities have slowed.
So, in a market where so many are seeking affordability, where are homes still the most expensive? What are the most expensive states to live in and buy a house? Whether you’re considering a move or just curious where housing costs the most, this Redfin article is for you.
The 10 most expensive states in the U.S.
California, Montana, and New York are the most expensive states in America, where a local homebuyer has to spend around 50% of their income on monthly housing payments. Hawaii (47.1%) and Massachusetts (45.9%) rounded out the top five.
| State | Share of income required to afford a typical home | Median household income | Median sale price |
| California | 52.4% | $107,551 | $777,566 |
| Montana | 47.7% | $78,675 | $527,848 |
| New York | 47.3% | $93,285 | $553,268 |
| Hawaii | 47.1% | $108,925 | $747,660 |
| Massachusetts | 45.9% | $112,800 | $687,847 |
| New Jersey | 44.9% | $112,362 | $587,128 |
| Rhode Island | 42.9% | $95,262 | $538,315 |
| Washington | 42.5% | $106,486 | $617,990 |
| Oregon | 42.5% | $90,070 | $521,368 |
| Idaho | 41.3% | $84,416 | $498,340 |
Out of all 50 U.S. states, nearly half (22) require locals to spend at least 35% of their income on housing, while an additional 15 states eat up between 30-35%. Arkansas (30%), Pennsylvania (31%), and Wisconsin (33.2%) fall into that second bucket.
Since the 1980s, most experts have recommended spending 30% of your income or less on housing expenses. But as costs climb and budgets get stretched, that decades-old logic is fading. For this analysis, we used 35% as the threshold for unaffordability.
States where affordability is declining the most
There are only two states where affordability is dropping: Alaska and New York.
New York is becoming more expensive in part because lower-cost markets in Western and Upstate New York have become increasingly competitive as home searchers seek affordability and more climate-resilience. Meanwhile, Alaska is dealing with a supply shortage in part due to environmentally complex construction and rising costs of materials.
| State | Share of income required to afford a typical home | Year over year change (ppts) |
| Alaska | 32.7% | +0.5 ppts |
| New York | 47.3% | +0.3 ppts |
In general, affordability is improving nationwide as wages climb faster than prices—although an uneasy economy is throwing some bumps in the road.
Coastal and mountain states are the most expensive places to live and buy a house
Unsurprisingly, America’s most expensive states largely mirror its most expensive cities. The wealthier, more space-limited coastal and mountainous states tend to have more expensive housing markets because of a fairly significant supply and demand imbalance. Zoning codes, a lack of homebuilding, and geographic constraints all play a role.
Montana is especially unique. During the pandemic, scores of wealthy newcomers from coastal areas looked to Big Sky Country for a change of pace and plenty of space. Most chose mountain towns like Bozeman, Missoula, and Whitefish, which pushed up prices in places where incomes were middling. Today, this has led to a statewide severe affordability crisis, where locals simply can’t afford to live where they previously did. The median sale price is $528,000, but the median income is just $78,000—less than two-thirds of what’s required to keep costs in reach.
On the other end of the spectrum, spacious states in the Midwest—Iowa, Indiana, and Oklahoma—are the most affordable, where ample supply outweighs demand.
>> Read: The Most Expensive Cities in the U.S. in 2026
Why is housing so expensive?
The U.S. has had a growing housing supply shortage since the Great Recession, which kicked into high gear during the pandemic homebuying craze. The fewer homes there are for buyers who want them, the higher prices go.
In recent years, even though demand has softened as more people have gotten priced out, sellers have also pulled back because they’ve struggled to find a buyer. This has kept prices high even as the market slows to a crawl.
But the outlook is improving. “The gap between America’s most and least expensive states is the narrowest it’s been on records dating back to 2012, and affordability has actually slowly increased since 2025,” said Daryl Fairweather, Redfin Chief Economist. “Recent economic volatility is pushing costs and wages in the wrong directions again, but economists are generally confident that the housing market will return to ‘normal’ levels over the next many years.”
>> Read: Why Are Houses So Expensive?
Methodology
Rankings expand on a June 2026 Redfin analysis of housing affordability by analyzing all 50 U.S. states. The analysis focused on the share of income a median-earning resident would need to spend every month to afford a typical for-sale home. A state was considered “unaffordable” if its monthly payment required more than 35% of statewide median monthly earnings, assuming a 20% down payment, typical taxes and fees, and a 30-year mortgage. States with the highest monthly income requirements ranked as the least affordable.
All data came from a Redfin analysis of MLS, U.S. Census, and Atlanta Fed data.
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