5 US states where you only need to make about $40,000 a year to afford the average home

The income you need to afford a home in the biggest U.S. cities

Have houses in the U.S. gotten too expensive? It depends. Financial website How Much used data from real-estate site Zillow to collect home prices for every state to find the minimum income needed to afford a place there and found that, in some areas, the income necessary is well below the national average.

Using a mortgage calculator, How Much calculated monthly payments, including the principal and the interest for an assumed home loan: "The interest rate varied from 4-to-5 percent in each state, depending on the market. The lower the rate, the lower the monthly payment. We assumed buyers could contribute a 10 percent down payment."

Based on that data, here are five states where you can afford a home while making an annual salary of around $40,000:

West Virginia 

Minimum annual income: $38,320
Average home value: $149,5000


Minimum annual income: $38,400
Average home value: $149,900


Minimum annual income: $40,800
Average home value: $160,000


Minimum annual income: $41,040
Average home value: $161,000


Minimum annual income: $42,200
Average home value: $165,900

How much more it costs to own vs. rent in your state

At the other extreme, "there are several pockets in which only the upper-middle class and above can afford to own even the average home, most notably across the West and in the Northeast," How Much notes. In Hawaii, the median home value is $610,000. In California, it's $499,900.

"Our map creates a quick snapshot of housing across the United States," writes How Much. Even though there are certain high-profile states where finding a home could be more difficult, "the best takeaway is that housing remains affordable in large swaths of the country."

If you're thinking of buying a home, check out these tips to get started.

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