As housing prices soar, a new report reveals that in 35 of the 50 U.S. states, an annual income of over $100,000 is needed to purchase a median-priced 3-bedroom home.
In California, the income required is a staggering $210,000, raising concerns that homeownership may be increasingly out of reach for Golden State residents.

According to a June 10 USA Today report, 35 states require a $100,000 income to afford a median 3-bedroom home. By region, Hawaii tops the list at $229,000, followed by Massachusetts ($216,000), California ($210,000), and New York ($190,000). Other states include Idaho ($163,000), Colorado ($161,000), New Jersey ($157,000), Connecticut ($144,000), Arizona ($141,000), Nevada ($140,000), Delaware ($138,000), Florida ($125,000), and Alaska ($122,000).

California’s housing market is particularly severe. According to the California Legislative Analyst’s Office (LAO), the state’s median home price is $789,000—more than double the national median of $361,000. Even California’s lower-tier homes, priced at $479,000, are $110,000 (32%) more expensive than the national median.

The LAO report paints an even bleaker picture than USA Today. As of March this year, the annual income needed to qualify for a mortgage on a median California home is $234,000—over twice the state’s 2023 median income of $96,500. For lower-tier homes, the required income is $142,000, nearly 50% higher than the 2023 median income.

Home prices in California have risen far faster than wages. From January 2020 to February 2025, monthly mortgage payments for median-tier homes surged 82%, and for lower-tier homes, 87%, far outpacing the 24% increase in average hourly wages. Over the same period, rents rose 38%, also exceeding wage growth.

The primary driver of California’s skyrocketing home costs is soaring mortgage rates. Since 2022, the Federal Reserve has raised interest rates to combat inflation, pushing mortgage rates upward. The benchmark 30-year fixed mortgage rate climbed from 2.7% in January 2021 to 7.6% in October 2023. As of June 5, 2025, Freddie Mac reported the rate at 6.85%, compared to an average of about 3% before 2022.

The LAO report notes, “Sharp rate increases have created challenges for both current and prospective California homeowners. While 81% of California homeowners have mortgage rates below 5%, new buyers face rates around 7%.”

By Hongyong Park, Reporter