Southern, Midwestern States Lead List of Most Affordable U.S. States

Mortgage rates remain elevated and some everyday groceries are at record prices, but a new ranking shows sizeable savings for households that choose to live in parts of the South and Midwest. US News & World Report’s state-by-state affordability comparison found southern and Midwestern states swept the top 10 spots, with Arkansas ranked the most affordable state.

Arkansas earned the highest overall affordability score in the US News analysis, placing first for cost of living and third for housing affordability. Mississippi came in second overall; West Virginia was third, Oklahoma fourth and South Dakota rounded out the top five. The study compared basic affordability across all 50 states to identify where everyday expenses and housing costs are most favorable for consumers.

Housing costs were a major driver of the rankings. Redfin data cited by the report showed the median sale price in Little Rock at about $250,000 in July, roughly $200,000 below the national median at that time. Mississippi’s housing market ranked among the most affordable in the country, contributing to its second-place finish even as its residents earn the least of any state. According to the U.S. Census Bureau’s 2024 American Community Survey, Mississippi’s median household income was just under $60,000 in 2024.

Affordability, the report noted, can come with trade-offs. Arkansas has frequently recorded some of the nation’s highest annual crime rates, and both Arkansas and Mississippi face challenges with access to health care. West Virginia’s third-place ranking was driven largely by highly affordable housing stock, while Oklahoma and South Dakota also ranked near the top for lower living costs.

The least-affordable states clustered at the other end of the list. California finished last in the US News affordability ranking, followed by New Jersey and Hawaii. Eight of the country’s 10 priciest metropolitan areas in the first quarter of 2025 were located in California, and major Bay Area markets remain fast-moving: homes in San Jose and San Francisco were reported to be selling in less than 30 days. New York placed at No. 45 on the affordability list.

Analysts and prospective movers often weigh affordability rankings against local labor-market conditions and public services. Lower housing and living costs can stretch household budgets in the face of high borrowing costs and rising grocery prices, but lower median incomes and limited access to health care or public safety concerns may offset some of those gains. US News’ ranking provides a snapshot of where basic living expenses are currently most favorable, while other quality-of-life measures remain important considerations for households deciding where to relocate.