America is in the midst of a housing crisis. The supply of homes is tight. The supply of affordable homes is even tighter, and persistently high mortgage rates are making the situation worse. But the extent of the problem varies from state to state.
That is why companies take the local housing market into account when choosing a location. They want their future employees to find affordable housing that also represents a good investment. This makes the housing market an important element of the competitiveness of state-owned companies.
CNBC considers the housing market as part of the economy category in “America's Top States for Business,” its annual ranking of all 50 states. Under this year's methodology, states are ranked based on that balance of affordability and value. We consider price appreciation and seller gains, as well as affordability, inventory and housing starts. We also look for signs of stress, such as foreclosures and negative-value mortgages.
While every buyer and seller has different priorities, you may get the best value for your money in the real estate markets in these ten states.
10. Delaware
Aerial view of upscale residential buildings in Brookside, Delaware, USA
Felixmizioznikov | Istock | Getty Images
Housing affordability is average in the First State, but your housing benefit in Delaware benefits greatly from very low property taxes. According to real estate data firm ATTOM, homeowners in Delaware paid an effective tax rate of less than half a percent. That's the fourth lowest in the country.
Economic ranking 2024: No. 10 (grade of the best states: B-)
Recognition: 4.73%
inventory (July): 2 months
Affordability assessment (0 to 2, with 2 being the best): 0.56
Effective property tax rate: 0.43%
Average selling price: $360,700
9. Indiana
Exterior view of ranch houses in a neighborhood in Indiana, Midwest, USA
Wanderlust | Istock | Getty Images
The Hoosier State offers a rare combination of affordability, including low property taxes, and healthy price appreciation. Supply remains tight, but Indiana homebuyers can still find what they're looking for at an attractive price.
Economic ranking 2024: No. 19 (grade of the best states: C)
Recognition: 8.02%
inventory (July): 2 months
Affordability Rating: 0.81
Effective property tax rate: 0.86%
Average selling price: $265,300
8. Georgia
A sign in front of a house for sale in Atlanta, Georgia, USA
Elijah New York | Bloomberg | Getty Images
Home sales in the Peach State are increasing, which is having a positive impact on affordability. Home builders are also active. Nevertheless, price growth remains healthy.
Economic ranking 2024: No. 7 (grade of the best states: B)
Recognition: 7.16%
inventory (July): 3 months
Affordability Rating: 0.59
Effective property tax rate: 0.82%
Average selling price: $385,600
7. Tennessee
Cynthia Holzapfel gestures as she describes the ground floor apartment of her home in Summertown, Tennessee, on June 15, 2024. Cynthia Holzapfel rents her ground floor apartment to families of all ages.
Kevin Wurm | Washington Post |
Although property taxes are among the lowest in the country, affordability is an issue in the Volunteer State. A new law provides incentives for more affordable housing in multifamily buildings. Supply has built up in the single-family home market, which has moderated price increases and could bring more buyers into the market.
Economic ranking 2024: No. 3 (grade of the best states: B+)
Recognition: 6.24%
inventory (July): 3 months
Affordability Rating: 0.49
Effective property tax rate: 0.44%
Average selling price: 393,000 US dollars
6. Nevada
A contractor works on a home under construction in the planned Versilia gated community in Southern Highlands in this aerial photograph taken over Las Vegas, Nevada, USA.
Roger Kisby | Bloomberg |
The Silver State's real estate market has historically been volatile, and this year is no exception. But inventory is manageable and home construction is active. While affordability remains an issue, prices have moderated – good for buyers, not sellers. Property taxes are low. Equity is healthy despite a rise in foreclosures.
Economic ranking 2024: No. 8 (grade of the best states: B)
Recognition: 3.39%
inventory (July): 2 months
Affordability Rating: 0.43%
Effective property tax rate: 0.48%
Average selling price: 458,300 USD
5. New Jersey
Island community on the coast of New Jersey in Barnegat Bay.
Johnrob | E+ | Getty Images
Home prices have soared in the Garden State over the past year as the real estate market remains active. Affordability could be better, but it's in line with median income. However, New Jersey has the second-highest property taxes in the country after Illinois and a high foreclosure rate.
Economic ranking 2024: No. 17 (grade of the best states: C+)
Recognition: 11.38%
inventory (July): 2 months
Affordability Rating: 0.56
Effective property tax rate: 1.64%
Average selling price: 532,400 USD
4. North Carolina
Workers build houses in Lillington, North Carolina, USA
Allison Joyce | Bloomberg |
The Tar Heel State is a busy place, with the second-highest number of new homes built last year after fast-growing Alabama. But supply is still tight enough to keep price increases high. Property taxes are reasonable, especially given the state's rapid growth.
Economic ranking 2024: No. 4 (grade of the best states: B+)
Recognition: 6.98%
inventory (July): 2 months
Affordability Rating: 0.52
Effective property tax rate: 0.6%
Average selling price: 383,700 USD
3. Arizona
A “For Sale” sign outside a mobile home at Coyote Ranch in Yuma, Arizona, on Friday, March 9, 2024.
The Washington Post |
Sellers continue to make decent profits in the Grand Canyon State, even as home inventory rises. Construction is strong and equity is healthy. Property taxes are low, but home affordability is also low.
Economic ranking 2024: NO. 5 (Grade of the best states: B+)
Recognition: 6.63%
inventory (July): 3 months
Affordability Rating: 0.44
Effective property tax rate: 0.41%
Average selling price: 450,800 USD
2.South Carolina
Homes in the Nexton community in Summerville, South Carolina, USA
Sam Wolfe | Bloomberg |
Real estate prices are rising in the Palmetto State, but housing remains relatively affordable. This price increase could lead to more construction, which is one reason for rising inventory. Property taxes are low. However, home financing could be better and foreclosure rates are high.
Economic ranking 2024: No. 12 (grade of the best states: B-)
Recognition: 9.42%
inventory (July): 3 months
Affordability Rating: 0.61
Effective property tax rate: 0.5%
Average selling price: $387,700
1. Florida
A view of Duval Street in Key West, USA, on May 7, 2024.
Jakub Porzycki | Only photo |
The Sunshine State's real estate market is notoriously difficult to gauge, but this much we do know: Home prices are rising and developers are trying to meet demand as more people flock to the state. Property taxes, while not the lowest, are helping to counteract the state's ongoing affordability issues. Some trends are more concerning, like the rising number of foreclosures and a growing number of underwater mortgages.
The state is also trying to emerge from a severe insurance crisis that is having a significant impact on home values and affordability. Florida's climate risk — including the risk to its housing stock — is real. But for now, Florida's housing market is achieving a decent equilibrium, albeit a fragile one, and that's helping to fuel the strongest overall economy in the country.
Economic ranking 2024: No. 1 (grade of the top countries: A+)
Recognition: 6.85%
inventory (July): 4 months
Affordability Rating: 0.44
Effective property tax rate: 0.76%
Average selling price: 420,100 USD