Realtor.com has released its annual housing report card, grading all 50 states and Washington, D.C., from A to F based on affordability and new home construction. The best-performing states are concentrated largely in the Midwest and South, regions known for lower living costs. Each state received a letter grade, with A representing the highest marks.
The report underscores a persistent challenge: even in strong markets, affordability remains strained. Joel Berner, a senior economist at Realtor.com, told Business Insider that homebuilding is a critical indicator of a healthy housing ecosystem. "Without new homes being built, affordability will suffer under constrained home supply," he said.
The analysis weighed two key factors: how affordable homes are and how much new housing is being developed. Regions with higher grades tend to have more abundant land and fewer regulatory barriers. These areas are attracting buyers priced out of coastal markets.
For prospective homebuyers, the rankings offer a data-driven starting point. States with A or B grades signal a more favorable balance of price and supply. However, local conditions within each state can vary dramatically, so buyers should drill down to city and neighborhood data.
Critics argue that letter grades oversimplify complex local dynamics. A single rating may obscure steep price variations between urban and rural areas within the same state.