What state has the most unaffordable housing?

Hawaii’s housing market is the most unaffordable in the U.S. in 2025, driven by exorbitant prices, scarce supply, and intense demand, creating a crisis for residents.

Skyrocketing Costs vs. Income: Hawaii’s median home price is $720,000, while the median household income is $66,000, resulting in a price-to-income ratio of 10.9—the nation’s highest. This dwarfs the national average of 5.1 and affordable states like West Virginia (2.8). In Honolulu, median home prices hit $775,000, making homeownership nearly impossible for most locals.

Severe Supply Shortages: Hawaii’s island geography restricts developable land, with 42% of the state under conservation or federal control. In 2024, only 3,100 housing permits were issued statewide, far below the 10,000 needed annually. This scarcity fuels competition, with homes often selling 15% above asking price. Zoning laws and high construction costs (30% above mainland averages) further limit new builds.

Demand Pressures: Hawaii’s status as a global tourism hub and retiree haven drives demand. In 2024, 30% of home purchases were by out-of-state buyers, many paying cash, sidelining local first-time buyers. High mortgage rates (6.3% in 2025) inflate costs, yet demand persists, especially for luxury properties.

Resident Impact: A staggering 39% of Hawaiian households spend over 30% of income on housing, the highest cost-burden rate nationally. Renters face median rents of $2,250/month in Honolulu, straining budgets. The crisis contributes to outmigration, with 1.2% of residents leaving annually, and rising homelessness.

Looking Forward: Without bold reforms—like streamlined permitting or affordable housing incentives—Hawaii’s market will remain unattainable. For now, its extreme price-to-income gap, limited land, and unrelenting demand cement its status as the nation’s least affordable housing market.