A recent study shows North Carolina residents pay an estimated $28,027 per year in housing expenses, draining 38% of the state’s take-home household income.
Home warranty experts Cinch Home Services conducted a study identifying states most susceptible to high housing costs. They analyzed average property taxes, mortgage payments, and maintenance fees for a median-priced home in each state. By calculating the total annual expense, the study revealed which states have the least financial cushion for these costs.
They found that North Carolina homeowners pay 10% less for housing expenses than the national average. With the median home in this state costing approximately $320k, the annual mortgage accumulates to $22.9k. The property tax stands at 0.82%, which adds an additional $2.6k for the same-priced home. Alongside annual maintenance costs, the total annual bill accumulates to $28,027.
Commenting on the findings, a spokesperson from Cinch Home Services said: “The dream of owning a home is a cornerstone of the American identity. However, for many, that dream is fading. In places like Hawaii, skyrocketing housing costs devour over 75% of a paycheck, forcing residents to choose between a roof and basic necessities. This isn’t an isolated issue – it’s a national problem.”
“Addressing this problem requires a multi-pronged approach. We must explore increasing the housing supply to meet demand while considering rental assistance programs and initiatives that make homeownership attainable for low- and middle-income families.”
The states with the biggest housing expenses
Hawaii struggles with the nation’s highest housing costs. Despite an average annual take-home pay of $86,376, residents face housing expenses reaching $65,185, which consume over 75% of their income. This burden stems from high annual mortgage payments ($60,048) and maintenance costs (the national average of $2,458). However, Hawaii does benefit from the lowest property tax rate in the U.S., at 0.32%.
California ranks second in the nation for annual housing costs. Residents pay an average of $61,337, representing 71.8% of their take-home pay. Contributing factors include the state’s high median home price of $743,362, translating to a hefty $53,304 in yearly mortgage payments alone.
Massachusetts follows closely in third place. Despite holding the highest average household income in the U.S. at $147,219, residents still dedicate 51.9% of their take-home pay to housing. Property taxes contribute significantly to this burden, averaging nearly $7,000 annually.
Washington takes the fourth spot with a median home costing $41.4K annually in mortgage payments, exceeding the national average by 38.8%. This translates to a significant chunk of their income towards housing, with total costs reaching 54.1% of their take-home household salary.
New Jersey follows closely behind Washington, with total housing costs reaching $48,000 annually. This represents 50.2% of their take-home household income.
The rest of the top ten most expensive states are Colorado ($44,385), New Hampshire ($43,122), Oregon ($42,843), Utah ($42,006), and New York ($40,294).
The states with the lowest housing expenses
In contrast, residents in West Virginia enjoy a significantly higher remaining salary compared to other states, with total expenses amounting to $14,506. The average household retains 76.6% of their take-home pay, which translates to a substantial $47,500 left over after expenses. However, West Virginia also has the lowest take-home salary in the U.S., 27.4% below the national average.
In Mississippi, homeowners spend 24.7% of their take-home household salary on housing expenses, with 19.1% on mortgage costs alone. The median-priced property here costs $172,654, making it the second-most affordable option in the nation.
Louisiana takes third place with a remaining household salary that translates to 25.1% of their take-home pay. Residents keep an extra $53,300 in their pockets each year, 10.7% more than the national average.
Arkansas also boasts attractively low housing expenses, which amount to 29.5% of their take-home pay. In this state, mortgage costs are particularly low, costing homeowners an average of $14,316 annually.
Oklahoma closes out the top five, with expenses amounting to $18,485. Property taxes are a mere 0.89%, costing residents approximately $1,771 annually.
Rounding out the top ten cheapest are Kentucky ($18,526), Missouri ($19,359), Iowa ($20,798), Kansas ($20,804), and Illinois ($21,012).
