Attention all millennials in the market for a new home: A new survey by GoBankingRates just revealed the best (and worst) states in which to do so. And since we know finances are the number one reason millennials don’t buy homes (or if they do, it’s because of their dogs), this is something to take into account.
The personal finance website reports that, per a median millennial income of $60,932, home-buying millennials should direct their attention to West Virginia. The Mountain State offers homes at a median listing price of $159,000, making it the most affordable location for those in the 25 to 34 age range. Iowa follows, with a median home listing price of $179,000.
As for the worst states, Hawaii (median listing price of $615,000) and California (median listing price of $539,000) top the list. To see where each state ranks, check out the full survey.
To provide these findings, GoBankingRates looked at median listing prices across all 50 states and compared them against the median income for millennials. The company then assumed a 20 percent monthly savings rate and calculated how long it would take a millennial to afford a 20 percent down payment. Finally, to ensure a fully thorough research plan, GoBankingRates also took the estimated monthly mortgage payment into account.
When compared to the company’s survey from 2017, many of the extremities remain the same. West Virginia and Hawaii were still the best and worst states for homebuyers, respectively, however, Iowa moved up to the second-best spot from fifth place. On the other end of the spectrum, Massachusetts and Colorado switched places, making the latter the third most expensive state in the country for millennials. We suspect the ubiquity of the CBD beauty trend might be at play.
This newest report is in line with earlier surveys—such as an August 2017 one by apartment listing company ABODO—which found that several metropolitan areas in California and Hawaii are the ones where the fewest millennials are purchasing homes. Citing issues like earning cuts and student loan debt, GoBankingRates’ Andrew DePietro spoke to what might be holding some millennials back from taking the plunge into home buying.
“Millennials’ financial picture today is a mixed bag,” writes DePietro in the introduction to the survey. “Yes, unemployment is low across the country, but wage growth hasn’t picked up. Young workers have to contend with billions of dollars’ worth of student loan debt.”
Yet, despite all this, millennials account for more than a third of homebuyers. Maybe their secret is in sticking to West Virginia.