The Most ‘Affordable’ Cities for First-Time Homebuyers Redefine Affordability | Insurify

To determine affordability, Insurify ranked metro areas by the share of median household income that homeowners would have to spend on homeownership costs. Insurify added mortgage costs, home insurance, property taxes, utilities, and maintenance costs to account for the true cost of homeownership.

To assess desirability, Insurify evaluated the local unemployment rate, the quality of the closest school districts, and proximity to a major city. The analysis excludes areas with an above-average violent crime rate.

Economic factors such as increased housing demand and higher local taxes can drive up the cost of living in cities. Affordable options exist for homeowners who want to live in or near a bustling city, but households earning the median income would have to stretch their budgets to accommodate ownership costs.

Key findings

• States in the South and Midwest offer more affordable housing markets without sacrificing desirability. Cities in Alabama, Wisconsin, Iowa, and West Virginia top the list for the most affordable and desirable cities in the U.S., according to Insurify’s analysis.

• Metro households spend a median amount of 57.1% of their income on homeownership. For this analysis, Insurify considered anything below the median to be affordable.

• The most affordable cities generally share several characteristics: a low cost of living, relatively low climate risk, and proximity to expansive nature.

• The least affordable cities, including Vineyard Haven, Massachusetts, and Key West, Florida, largely include vacation destinations with high property values and an above-average median household income.

The 10 most affordable, up-and-coming cities for first-time homebuyers

From 2015 to 2024, home values rose by 94%, riding higher construction costs and limited supply that couldn’t meet the increased demand. In the same period, the median household income rose by only 15%, pushing would-be homeowners to make concessions between what they want and what they can afford.

First-time homebuyers looking for affordable places to put down roots may need to explore smaller, lesser-known cities to find the best deals. Among U.S. metropolitan areas, homeowners spend a median of 57.1% of their income on housing costs, according to Insurify analysis.

The most affordable and desirable cities in the U.S. are located in eight states, mostly in the South and Midwest: Alabama, Iowa, Minnesota, New York, North Carolina, Pennsylvania, West Virginia, and Wisconsin.

While spread across the country, these cities share a few key factors. They generally have a low cost of living that often falls well below the U.S. average, or even the state average. They have quick access to the great outdoors, like nearby state parks or walking trails.

And, key for affordability, most also have low climate risk, which can keep home insurance costs low and reduce the possibility of expensive repairs. Many of these cities also have growing populations, rising property values, and expanding economies.

In these 10 cities, homeownership costs make up the smallest share of median household income.

1. Huntsville, Alabama

• Percent median income spent on homeownership costs: 49%

• Desirability Score (out of 100): 73.6

• Average annual cost of home insurance: $2,784

• Average monthly cost of homeownership: $3,388

Huntsville is a lively city near Alabama’s northern border with Tennessee. It’s the most affordable city because homeowners earning the metro area’s median household income of $83,529 could expect to spend 49% of their income on homeownership costs, the lowest share among the most affordable and desirable cities.

Its notably low unemployment rate of 2.2%, below-average violent crime rate, and above-average school district score added up to its Desirability Score of 73.9. Its monthly homeownership costs of $3,388 fall below the U.S. average of $3,618.

Huntsville is also known as “Rocket City,” since it’s home to the U.S. Space and Rocket Center. The city has one of the fastest-growing urban economies in the U.S., according to nonpartisan think tank the Milken Institute.1 Leading employers include the U.S. government, healthcare, and auto manufacturing at the nearby Mazda Toyota plant.

2. Janesville, Wisconsin

• Percent median income spent on homeownership costs: 51%

• Desirability Score (out of 100): 70.1

• Average annual cost of home insurance: $1,441

• Average monthly cost of homeownership: $3,148

Janesville is a quaint riverside city in Wisconsin near the Illinois border. In about an hour’s drive, residents can reach larger cities like Madison and Milwaukee. The unemployment rate is just 2.8%, well below the U.S. average of 4.4%, and the city saw modest job growth from 2019 to 2024, according to the Milken Institute.

Even in this small, affordable city, first-time buyers spend 51% of the city’s median household income of $74,390 on homeownership costs. The median home value is $274,708, nearly 25% lower than the U.S. median of $357,275. Home values grew 23.5% since 2022, nearly five times the national average, making it a great city for middle-income buyers looking to invest in property.

3. Fond du Lac, Wisconsin

• Percent median income spent on homeownership costs: 51%

• Desirability Score (out of 100): 71.9

• Average annual cost of home insurance: $1,353

• Average monthly cost of homeownership: $3,113

Fond du Lac is a charming, affordable city on the banks of Lake Winnebago. Milwaukee is about an hour’s drive south, and Green Bay is an hour north. It’s a walkable city with a low cost of living, low unemployment, and low climate risk.

Fond du Lac also has a relatively diverse economy, with manufacturing, education, health services, and trade among the largest sectors, according to Wisconsin’s Department of Workforce Development.2

Fond du Lac is another great city for first-time buyers wanting to invest in property. Property values have also grown 21.2% since 2022, more than four times the U.S. average of 5.5%, to $274,455. Like in Janesville, homeowners spend about 51% of the metro area’s median household income of $73,154 on home costs.

4. Ames, Iowa

• Percent median income spent on homeownership costs: 51%

• Desirability Score (out of 100): 88.8

• Average annual cost of home insurance: $2,513

• Average monthly cost of homeownership: $3,042

Home to Iowa State University, Ames is a bustling college town in the center of Iowa, about a 40-minute drive north of Des Moines. Its low violent crime rate, low unemployment, and strong school district scores add up to its high 88.8 Desirability Score.

The university, a large U.S. Department of Agriculture service office, hospitals, and retailers provide a strong job market that has seen modest growth over the last few years.

Median household income and homeownership costs are similar to those in Janesville and Fond du Lac: costs add up to 51% of the city’s median household income of $71,090. Property values, too, have grown faster than the U.S. average, at 7.8% from 2022 to 2025. The median home value in Ames is $254,485, almost one-third lower than the U.S. average of $357,275.

5. Morgantown, West Virginia

• Percent median income spent on homeownership costs: 52%

• Desirability Score (out of 100): 88.6

• Average annual cost of home insurance: $1,517

• Average monthly cost of homeownership: $2,679

Morgantown is a lush riverside college town with quick access to scenic trails and the West Virginia University football stadium. Homeownership costs are lower in Morgantown than in the first four cities, but the median household income is also lower. Costs account for 52% of Morgantown’s median household income of $62,394.

The city is walkable and has a cost of living 18% lower than the U.S. average. Its low violent crime rate and high school district scores contribute to its 88.6 Desirability Score. The nearest major city is Pittsburgh, Pennsylvania, a little over an hour’s drive north from Morgantown. It faces few climate risks and has low home insurance rates and steadily climbing property values, which could all add up to a stable investment for first-time buyers.

6. Gettysburg, Pennsylvania

• Percent median income spent on homeownership costs: 53%

• Desirability Score (out of 100): 96.5

• Average annual cost of home insurance: $1,265

• Average monthly cost of homeownership: $3,580

Gettysburg is a charming, walkable, historic city in Southern Pennsylvania. It claims the highest Desirability Score among the most affordable cities for first-time homebuyers. Its exceptionally low violent crime rate, below-average unemployment rate, and strong school district scores contribute to its high score of 96.5.

Gettysburg isn’t close to a large city; Baltimore, Maryland, is the nearest major city, about an hour and a half’s drive southeast. But its property values have increased at a rate nearly three times the national average, while the median home value of $320,511 remains below the U.S. median. The area has a median household income of $81,071, and homeownership costs take up 53% of household income.

7. Gadsden, Alabama

• Percent median income spent on homeownership costs: 53%

• Desirability Score (out of 100): 73.8

• Average annual cost of home insurance: $3,241

• Average monthly cost of homeownership: $2,352

Gadsden is a historic riverside city with easy access to nature parks and golf trails, about an hour’s drive east of Birmingham. Residents enjoy a low cost of living and a largely walkable city. The low unemployment rate of 2.8% contributes to its Desirability Score of 73.8.

Gadsden has the lowest median household income among the 10 most affordable and desirable cities, at $53,070. But it has the lowest homeownership costs among the most affordable cities for first-time homebuyers, at $2,352 per month, which amounts to 53% of the median income.

Home values have grown at double the national average rate but remain affordable for first-time buyers. The median home value in Gadsden is $177,803, about half the U.S. median home value.

8. Mankato, Minnesota

• Percent median income spent on homeownership costs: 54%

• Desirability Score (out of 100): 79.1

• Average annual cost of home insurance: $3,224

• Average monthly cost of homeownership: $3,349

Mankato is a charming, affordable city ringed by nature, like Minneopa State Park and Mount Kato, a popular ski mountain. And while Mankato isn’t the most walkable city, its cost of living is 13% below the U.S. average, and the area faces little climate risk.

Mankato has a diverse economy, with healthcare, education, and commercial services employing the most residents.3 Its low unemployment rate of 2.9% contributes to its Desirability Score of 79.1. The city’s median household income is $74,722, and buyers earning that spend 54% of their income on homeownership costs.

First-time buyers would benefit from its bustling college-town atmosphere, economic opportunities, and rising property values. The median home value in Mankato is $293,781, about 18% below the U.S. median.

9. Glens Falls, New York

• Percent median income spent on homeownership costs: 55%

• Desirability Score (out of 100): 67.7

• Average annual cost of home insurance: $1,577

• Average monthly cost of homeownership: $3,413

Glens Falls, known as the Gateway to the Adirondacks, is a picturesque, historic city on the Hudson River in upstate New York. It’s affordable and walkable, with a below-average cost of living. Significant local industries include medical and surgical instrument manufacturing, finance, and tourism, since Glens Falls is a short drive south of Lake George.4

The median home value in Glens Falls is $293,681, and property values have risen at nearly twice the national average rate, making it a great place for first-time buyers to invest. Homeownership costs add up to 55% of the area’s median household income of $74,953. The area also faces little climate risk, reducing the likelihood of expensive repairs or skyrocketing home insurance rates.

10. Raleigh, North Carolina

• Percent median income spent on homeownership costs: 55%

• Desirability Score (out of 100): 83.3

• Average annual cost of home insurance: $2,292

• Average monthly cost of homeownership: $4,401

Raleigh is a great choice for first-time homebuyers who crave a big city environment. Residents enjoy access to museums, nightlife, traditional barbecue, and popular college sports games. It’s also easy to get around: Raleigh scores well for the ease of walking, biking, and taking public transit.

Its top public education scores and below-average violent crime and unemployment rates contribute to its Desirability Score of 83.3. Raleigh also has a diverse, growing economy, with 15.8% job growth from 2019 to 2024, according to the Milken Institute.

Buyers may end up trading some affordability for the convenience of an urban area. Raleigh is the only city on this list with a median home value higher than the U.S. median, at $429,457. Homeownership costs are $4,401 per month, but the city’s higher median household income of $96,066 means those costs still account for only 55%.

The least affordable cities for first-time homebuyers

Destination or second-home cities top the list for the least affordable cities for first-time homebuyers.5 Homeownership costs in these cities add up to more than 100% of the median household income, suggesting that homeownership is only affordable, and possibly only available, to people with higher incomes.

The two most expensive aren’t just coastal cities, they’re islands: Vineyard Haven on Martha’s Vineyard in Massachusetts and Key West, the outermost island in the Florida Keys. The median home value in Vineyard Haven is $1.4 million, and home insurance costs are also elevated due to an increased risk of coastal flooding. The average annual home insurance premium is $4,059, versus the state average of $2,354, according to Insurify data.

Climate risk is even higher in the Florida Keys, which has a history of significant insurer losses from coastal flooding, lightning, and hurricanes. The median home value is $927,000, but the average annual home insurance premium is $26,615 — nearly three times the state average of $9,832.

The other cities rounding out the “most expensive” list are all mountain-area cities with high property values near world-class ski resorts. Jackson, Wyoming, for example, is near the Grand Teton and Yellowstone national parks and home to three ski resorts.

Median property values range from $996,962 in Hailey to $1.4 million in Jackson, but home insurance rates are cheaper than average. Though each of these areas has high avalanche risk, home insurance doesn’t typically cover damage from land movement.

The most affordable states for first-time homebuyers

First-time homebuyers will find the most affordable average costs in Southern and Midwestern states. But even in Iowa, the most affordable state for first-time buyers, homeowners earning the median household income spend close to 50% of their income on homeownership costs.

The five most affordable states are Iowa, West Virginia, Indiana, Michigan, and Kansas. Each has a relatively low median home value, which is below $300,000 in every state and below $200,000 in West Virginia. All but Kansas have annual home insurance costs below the U.S. median. Kansas’s elevated risk for hail, lightning, and tornado damage may contribute to its higher insurance rates.

Presidential executive order aims to reduce competition to make homeownership more affordable

The share of first-time homebuyers dropped to a record low of 21% in 2025, while the median age climbed to a record high of 40 years, according to the National Association of Realtors (NAR).6 This equates to “staggering” implications on the housing market, because first-time buyers are building less housing wealth and will likely move less over a lifetime, NAR Deputy Chief Economist and VP of Research Jessica Lautz said in a press release.

The White House has floated a number of solutions to address housing issues, such as a 50-year mortgage, temporarily lowering credit card interest rates, and allowing withdrawals from 401(k) retirement accounts to cover a down payment. Each of these, however, could have bleak financial consequences down the line, possibly saddling multiple generations with debt.

On Jan. 20, President Donald Trump signed an executive order aimed at preventing institutional investors from buying single-family homes “that could otherwise be purchased by families.”7

“President Trump is working to make homeownership affordable again after years of Wall Street crowding out first-time buyers and young families,” the White House wrote in a fact sheet. “Institutional buyers with vast resources outbid hardworking families, turning neighborhoods into investor rental portfolios instead of communities.”

However, despite this stated goal, the executive order includes an exception for “build-to-rent” properties that are specifically built as rental communities.8 While this may increase the availability of affordable housing, a dire need in many metro areas, it doesn’t necessarily create a pathway to homeownership.

Two homebuilding companies announced a “Trump Homes” pathway to homeownership proposal. The program, funded by private investors, would sell entry-level homes in a rent-to-buy model, where three years of rent payments would count toward a down payment on the home. But a White House source told Bloomberg that the administration isn’t actively considering the plan.9

Tips: What hopeful homeowners should consider before buying

The road to homeownership is longer and perhaps more uphill than it was for past generations. But, despite persistent affordability challenges, first-time homebuyers have numerous strategies available to help make the dream of homeownership a reality.

Being proactive and starting early can make buying a home easier, and not just when it comes to saving for a down payment. Hopeful buyers should check their credit scores well before starting the process and work toward earning or maintaining a strong credit history to qualify for better loan rates.

They can research mortgages, debt, and the homebuying process. Investigating state or local down-payment or loan assistance programs could reduce the up-front costs of buying a home and may help shorten the road to homeownership.

Adding up extra costs before buying can also ensure first-time buyers don’t end up with a house they can’t afford. Home insurance premiums, for example, can vary widely, so comparing rates before closing on a house means buyers will know what they’re getting into.

“For first-time buyers in 2026, home insurance isn’t just a line item; it’s part of understanding the true cost of homeownership,” said Mallory Mooney, director of sales and service at Insurify.

“We’re seeing regional differences widen, particularly in areas prone to severe weather or higher rebuilding costs,” she said. “That doesn’t mean homeownership is out of reach, but it does mean buyers should evaluate insurance early in the process. Getting quotes before closing gives buyers clarity, negotiating power, and confidence that the home they choose fits both their lifestyle and their long-term budget.”

Methodology

Insurify data scientists turned to their real-time database of insurance quotes from partner carriers, as well as aggregated rate filings from Quadrant Information Services, to determine average home insurance costs.

Unless otherwise stated, home insurance rates in this report represent the average annual cost of an HO-3 insurance policy for homeowners with good credit and zero claims within the past five years, covering a single-family frame house with the following coverage limits: $200,000 to $750,000 dwelling coverage depending on the locality’s typical home value, $25,000 personal property, $30,000 loss of use, $300,000 liability, and a $1,000 deductible. Certain states also include a 2% hail deductible and/or a 5% wind/hurricane deductible.

In addition to proprietary insurance data, Insurify used several external sources for data to calculate the total cost of homeownership:

• Home values and mortgage costs reflect the Zillow Home Value Index values for December 2025. Insurify calculated maintenance costs as 2% of the home value.

• Effective tax rates for metro areas and states are from the Tax Foundation’s 2023 five-year estimates by state and county. The national average rate is from ATTOM, a real estate data firm.

• Utility costs reflect 2025 state averages from Move.org.

• Mortgage rates are from a YahooFinance analysis of Zillow data.

• Median household income data is from the U.S. Census Bureau, Table B19013, 2023 5-Year Estimates.

Desirability factors also include external data. Violent crime data is from the 2024, 2023, and 2022 FBI Crime in the U.S. reports. Unemployment rates by metro area are from the U.S. Bureau of Labor Statistics. School district scores reflect Niche grades. Though not included in the desirability score, Insurify referenced Walk Score to assess walkability, the Economic Research Institute for cost of living, and the Federal Emergency Management Agency for climate risk.

For media inquiries or questions about our study, please contact the author here.