All of us are aware of the fact that purchasing a home is a big life decision and a really expensive one at that. After a review of the down payment, property taxes, and the closing costs, the purchase price of a home can add up to a big amount real quickly.
One of the key goals for most people in the US is the ownership of a house that they can call home. It can however be really difficult to secure a mortgage and purchase that home. As per different reports published in 2020, the median value of a home in America is nearly $250,000. That is an increase of nearly 4.5 percent from the previous year. It is expected that the home values may fall in the next year by around 1.4 percent. Despite this, the amount of money that you will end up spending to buy a home will primarily depend on where you will be purchasing that home and living.
If you are retiring and wish to relocate, then beginning the process of searching for a new home again and buying it can be really daunting. But there is still hope as there are many states where homes can be purchased at affordable prices.
When looking for the cheapest states to buy a home in, you need to check the median listing price, the effective rate of property tax, the median per square foot listing price, the average closing charges, and the median house value for homes listed in the bottom 1/3rd.
In 2020, the most affordable homes can be purchased in The South and The Midwest. Homes in both the East (Massachusetts, New York, New Jersey, Maryland, and New Hampshire) and West (California, Washington State, Oregon, and Hawaii) coasts are expensive. Along with Washington D.C., homes in the East and West coast states have an average listing price of nearly $443,000.
Presented below are the top 5 states with the cheapest priced homes in 2021.
- West Virginia
West Virginia is the state where the most affordable and cheapest homes are available for purchase. The Mountain State famous for its coal mining industry and pleasant landscape has an average effective property tax rate of 0.57 percent. The median listing price of homes in the state is about $165,000 which is the lowest in the country. At about $53,599, it also takes the top spot with regards to the median value for the bottom one-third of the homes. Finally, with regards to the median per square foot listing price, West Virginia ranks second with a price of about $98.
- Arkansas
The home state of former US President Bill Clinton comes second in the list of the states with the cheapest homes. The median list price of homes in Arkansas is around $176,000 which is the fifth-lowest in the country. Its median listing price per square foot is about $102, which is the third-lowest, and its median value for the bottom one-third of the homes is about $63,000, which is the second-lowest in the US. The average effective property tax rate is also just 0.61 percent.
- Alabama and Mississippi
The states of Mississippi and Alabama are tied in the third place with regards to the availability of the most affordable homes in the US.
The median listing price for homes in Alabama is about $219,900. The median value for the bottom one-third of the homes is about $66,100, while the median listing price per square foot is about $105. Both are the fourth lowest in the country. The average effective property tax rate in Alabama is 0.40 percent which is the second-lowest in the US.
Mississippi is another southern state in this list with affordable housing. The median listing price for homes is about $189,000. The median value for the bottom one-third of the homes is about $70,800, the 5th lowest in the US. Also, the median listing price per square foot is about $96, which is the lowest in the country. Even though the average effective property tax rate in Mississippi of 0.78 percent is a tad above other states in the list, it still ties third in the list with Alabama due to the low average closing costs and median listing price.
- Indiana
The Hoosier State ranks fourth in this list of states with the cheapest homes in the US for 2020. The median listing price for homes in Indiana is about $186,000, which is the seventh-lowest in the country. The median listing price per square foot is about $108, which is the 5th lowest. The average effective property tax rate is 0.82 percent, which is neither too low nor too high. The average closing costs while buying a home in Indiana is about $2,625, which is the second-lowest in the US.
- Oklahoma
The state of Oklahoma completes this top 5 list of the states with the most affordable housing.
The median listing price for homes in Oklahoma is about $193,000. The median value for the bottom one-third of the homes is the third-lowest at about $64,100, while the median listing price per square foot is the fifth-lowest at about $108. The average effective property tax rate is 0.89 percent, while the average closing costs are also comparatively low at about $2,673 (the fifth lowest in the country).
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