It’s a tough real estate market no matter where you live, but some parts of the US are faring better than others.
Realtor.com released its annual housing report card on Monday, grading all 50 states and Washington, DC, from A to F based on how affordable homes are there and how much new housing is being built.
Joel Berner, a senior economist at Realtor.com, told Business Insider that homebuilding is an important indicator of a housing ecosystem because it signals how affordable homes will be over time.
“Without new homes being built, affordability will suffer under constrained home supply,” he said.
Once again, the best-performing states — those earning either an A or a B grade — were concentrated mostly in the Midwest and South, regions known for their lower cost of living and abundance of relatively affordable homes.
Indiana ranked No. 1, largely because incomes there are relatively high compared with home prices, giving buyers more affordable options. But Berner said the state’s “unremarkable” new-home construction could point to affordability problems in the future.
At the other end of the ranking, states that received grades between C and F were largely concentrated in the West and New England. Berner said building in these states is often slower and more expensive because of zoning rules, permitting delays, and building codes. As a result, they struggle to compete with states in the middle of the country, where land is cheaper, and building is generally easier.
Below are the 10 best and worst states in the US for affordability and homebuilding, according to Realtor.com.
Median listing prices and median household incomes for these states are from Realtor.com. Population data for each state is from the US Census Bureau.
The 10 best states for homebuilding and affordability
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10. Oklahoma
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9. Arkansas
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8. South Dakota
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7. Delaware
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6. Nebraska
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5. North Carolina
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4. Texas
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3. South Carolina
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2. Iowa
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1. Indiana
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The 10 worst states for homebuilding and affordability
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10. New Hampshire
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9. New Jersey
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8. Montana
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7. Oregon
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6. Connecticut
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5. California
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4. Hawaii
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3. Rhode Island
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2. Massachusetts
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1. New York
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