Housing affordability report card: Only one state gets an A

AUSTIN - A new report is shining a national spotlight on the growing housing crisis, revealing the states with the highest affordability and housing supply – and only one state received an A rating.

The report, released by Realtor.com, ranked all 50 states based on how well they balanced housing affordability with new construction efforts.

South Carolina earns highest grade; Northeast and West lag behind

By the numbers:

South Carolina earned the highest grade – an A – thanks to proactive construction efforts that outpaced demand. 

Other top performers include Texas, with robust building activity, and Iowa, one of the most affordable housing markets in the country. 

FILE - A for sale sign is displayed outside of a home for sale on Aug. 16, 2024, in Los Angeles, California. (Photo by PATRICK T. FALLON/AFP via Getty Images)

The report found that the top-tier states were largely concentrated in the South and Midwest, where land is more plentiful and housing is largely more affordable.  In fact, the lowest grade earned by a state in the South and Midwest was in the C range. 

By contrast, states on the West Coast and in the Northeast received the lowest grades. Rhode Island, Massachusetts, New York, Hawaii, and California were at the bottom of the list, all receive a failing grade due, in part, tosky-high housing costs and limited new construction. Tight zoning laws and complex permitting processes were other key barriers in these regions.

What they're saying:

"The only real solution to housing affordability is to build more homes," said Damian Eales, the CEO of Realtor.com. "Some states are making progress, but too many others are stuck in a cycle of soaring housing costs and limited inventory. With this report and the Let America Build campaign, we're shining a spotlight on these gaps. We need bold solutions, and we urge federal, state, and local leaders to step up and take action now. It's time to break the cycle and start building now to make homeownership a reality for more Americans."

State-by-State housing affordability report card

1. South Carolina: A
2. Iowa: A-
3. Texas: A-
4. Indiana: B+
5. North Carolina: B+
6. South Dakota: B
7. Nebraska: B
8. Arkansas: B
9. Georgia: B
10. Minnesota: B-
11. Virginia: B-
12. Louisiana: B-
13. Alabama: B-
14. Florida: C+
15. Oklahoma: C+

See the full report here.

Housing affordability

Dig deeper:

According to another recent study, buying a home became more affordable in 2024, but only by the slimmest of margins.

Real Estate company Redfin’s analysis found that 2024 was still the second least affordable homebuying year on record, surpassed only by 2023.

RELATED: Housing affordability improved in half of the largest US markets last year; see the list

The data revealed that a household making the $83,782 median U.S. income in 2024 would have had to spend 41.8% of their earnings on monthly housing costs if they bought the $429,734 median-priced U.S. home. 

That’s a slight improvement from 42.2% in 2023, but is considerably less affordable than the typical share of 30% or lower recorded throughout the 2010s.