States With the Most Starter Homes For Sale

Offering a more affordable path into the housing market, the starter home is often the first step into homeownership for many Americans. But with a shortage of lower-priced homes, buying that first property has become increasingly difficult. From 2000 to 2023, inflation-adjusted median home prices rose by 56.5%, while median household incomes grew by just 8.5% during the same period.

While the starter home has become less attainable across the U.S., some states have a larger supply of starter homes than others. To find where first-time buyers are most likely to succeed in purchasing a starter home, Construction Coverage analyzed data from home listings nationwide. West Virginia topped the list as the most favorable state for starter homes, followed by Mississippi and Oklahoma. In these states, smaller, more affordable homes make up over 70% of available properties.

On the other end of the spectrum, Hawaii is the least accessible state for first-time homeowners. In that state, mortgage payments can consume more than 73% of the typical income. California follows closely behind, where mortgage payments take up about 64% of the typical income.

Although recent market trends have presented significant challenges, the issue of housing affordability has persisted in the U.S. for decades. At the heart of the problem is the widening gap between rising home prices and comparatively stagnant household incomes.

Supply has been another constraint for first-time homebuyers. The U.S. faces a shortage of housing overall, but builders are also building fewer of the smaller, more affordable homes they used to. One- or two-bedroom homes represented 24% of single-family homes built in the mid-1980s, but just 5% in 2023—the lowest level on record. Over the same span, the share of new homes with four or more bedrooms grew from 19% to 51%.