17 States Where It’s Not Worth Buying a Home

Did you know that in 2025, despite a cooling market in some areas, the gap between wage growth and housing costs remains at historic highs? With 30-year mortgage rates stabilizing near 6.5% and insurance premiums surging, home buying has become a risky financial move in many parts of the country. This guide dives into the 17 states where real estate investment might not be worth the risk right now.

California

Tempted by year-round sunshine and coastal views? It’s still dreamy—but the price tag is more nightmarish than ever. As of August 2025, California’s median home price hit nearly $900,000 ($899,140), according to the California Association of Realtors. When you factor in property taxes, some of the highest utility rates in the nation, and an insurance market in crisis, it is no wonder the “California Exodus” continues, with residents fleeing for more affordable pastures.

New York

The Empire State remains a financial fortress that is hard to breach. While NYC is notorious, the statewide median home price has climbed to approximately $550,000 as of late 2025. Upstate cities like Buffalo and Syracuse have seen prices rise, eroding their former affordability. Renting remains the mathematically superior option in many zones; in parts of the state, the monthly cost of owning is now significantly higher than renting comparable units.

Hawaii

Paradise has a premium that just keeps growing. While prices have fluctuated, the median home price in Hawaii remains one of the highest in the U.S., hovering around $769,000 (Redfin, October 2025), with single-family homes often commanding much more. When you add in the highest cost of living in the nation for imported goods and utilities, a timeshare or a rental continues to be the safer bet for enjoying the island life without the anchor of debt.

Illinois

Even the Windy City can’t blow away Illinois’ troubling homeownership costs. Property taxes here remain the second-highest in the nation, trailing only New Jersey, with effective rates frequently topping 2.08%. While home prices are more moderate than on the coasts, the tax burden eats away at equity faster than appreciation can build it, leading many experts to recommend renting until tax policies shift.

Texas

Everything is bigger in Texas—especially the property tax bill. While the Austin market has finally cooled—with median prices dipping to around $430,000 in early 2025—the state’s property taxes remain a heavy burden, averaging nearly 1.9%. If you buy a home in Texas, you aren’t just paying a mortgage; you are paying a “second mortgage” to the tax assessor in perpetuity.

Florida

Dreaming of retiring on Florida’s sunny shores? Proceed with caution. While median prices have flattened to around $410,000 in 2025, the real story is the insurance crisis. Homeowners insurance rates in Florida have skyrocketed to nearly four times the national average, and HOA fees in condo buildings are surging due to new safety regulations. For many, renting is now half the cost of ownership when all these hidden fees are tallied.

Nevada

Las Vegas might be a jackpot for fun, but the housing market is no game. As of August 2025, the median home price in Southern Nevada has climbed to roughly $480,000. Inventory is rising, but with mortgage rates keeping monthly payments high, affordability is slipping away. Unless you plan to stay for a decade, the volatility of the Vegas market makes renting a safer gamble.

Connecticut

Prices in Connecticut continue to make buyers hesitate. With property taxes averaging effectively 1.92% (3rd highest in the U.S.) and home values climbing steadily due to low inventory, your monthly outlay is substantial. You could find your money works harder in markets with a friendlier tax climate.

Oregon

Oregon’s natural beauty is undeniable—but affording it is another story. The state’s housing market remains tight, with median prices often exceeding $500,000. Inventory remains a chronic issue in 2025, leading to competitive bidding situations despite higher interest rates. Renting allows you to enjoy the Pacific Wonderland without fighting a bidding war.

Colorado

The Rockies are calling, but you should screen the call. Denver and Boulder remain stubbornly expensive, with metro area median prices often sitting well above $600,000. The “rent vs. buy” gap here is one of the widest in the interior U.S., meaning you can often rent a luxury apartment for significantly less than the mortgage on a modest starter home.

Washington

Rain jackets and coffee aside, homeownership in Washington is a luxury good. Seattle’s median home price hovered around $898,000 in mid-2025. Even with a slight cooling in some suburbs, the entry price is prohibitive for most first-time buyers. For tech workers and remote employees, renting provides flexibility and massive monthly savings compared to buying.

New Jersey

New Jerseyans continue to face the highest property taxes in America, with an effective rate of roughly 2.23% in 2025. On a median-priced home, that is an annual tax bill that can easily exceed $9,000 to $10,000. Renters effectively dodge this massive liability, making the Garden State a much better place to lease than to own.

Massachusetts

The Bay State is pricing out its residents. The statewide median home price surged to approximately $658,000 in August 2025. Even formerly affordable hubs like Worcester are seeing values climb rapidly. With mortgage rates where they are, the math heavily favors renting, especially if you want to live anywhere near the economic hub of Boston.

Alaska

Remote living and unbeatable landscapes come at steep costs. Supply chain issues continue to keep construction and maintenance costs premium in 2025. Building or repairing a home here costs significantly more than in the lower 48 states. Renting shields you from the surprise costs of maintaining a property in a harsh tundra climate.

Pennsylvania

Pennsylvania’s housing market looks approachable on paper, but the age of the inventory is the hidden killer. With some of the oldest housing stock in the country, “affordable” homes often come with massive deferred maintenance costs. Unless you have a deep budget for renovations, renting a newer unit is often the more practical financial move.

Vermont

The Snowy Mountains are stunning, but Vermont is quietly becoming incredibly expensive. Property taxes are high (top 5 in the nation), and limited housing stock has kept prices elevated even in 2025. Renters can enjoy the charm of New England without the heavy tax burden and high heating oil costs associated with owning older farmhouses.

Arizona

If you are eyeing the Grand Canyon State, you will need deep pockets. While the frenzy of 2022 has passed, Phoenix prices have stabilized at a high plateau, with a median listing price around $485,000 in late 2025. The days of cheap desert living are over, and with water concerns becoming a long-term conversation, renting offers a flexibility that ownership does not.

Read the original article on Crafting Your Home

Disclaimer: This list is solely the author’s opinion based on research and publicly available information from 2025 market reports. It is not intended to be professional financial advice.