US Midwest Remains One of the Most Affordable Regions for Homeownership for 134 Years

As the United States housing market has undergone dramatic transformations over the past 134 years, the nation's Midwest region has consistently stood out as a bastion of affordability for those seeking homeownership. According to a new analysis by researchers at the Federal Reserve Bank of Philadelphia, while the rest of the country experienced significant boom-and-bust cycles, home prices in certain Midwestern cities have remained largely flat for over a century. This starkly highlights a persistent regional divergence in housing accessibility.

The Federal Reserve Bank researchers conducted a painstaking study spanning nearly a decade, manually compiling 2.7 million real estate listings dating back to 1890. This extensive dataset enabled them to construct annual market rent and sales price series for several major U.S. cities. The findings revealed that between 1890 and 2024, home price indexes in San Diego and Los Angeles surged by over 1,000%, and nearly half as much in Boston. Nationally, the U.S. saw a 354% jump. In contrast, in a Midwestern city like St. Louis, inflation-adjusted prices over the same period increased by only about 6%, while Cleveland saw an increase of approximately 18%.

This historical trend continues to manifest in contemporary housing market dynamics. Recent analyses from platforms like WalletHub and Realtor.com consistently rank Midwestern and Southern states and cities high in affordability. For instance, WalletHub's 2025 data indicates that Midwestern cities such as Detroit, Pittsburgh, and Memphis lead the list of most affordable cities, driven by low home prices, fair taxes, and solid income-to-cost ratios. Realtor.com's 2026 report further highlights states like Indiana, Iowa, and South Carolina for their strong performance across both housing affordability and homebuilding activity.

Several economic and demographic factors contribute to the Midwest's sustained affordability. The region generally exhibits slower demand growth and more balanced supply-demand dynamics compared to coastal states in the West and Northeast. Furthermore, many Midwestern cities did not experience the extreme imbalances of supply and demand seen elsewhere during the pandemic-induced housing boom. These fundamental factors are increasingly becoming a significant competitive advantage for the Midwest as buyers adjust to a higher mortgage rate environment.

Analysts and market experts anticipate that the Midwest will continue to maintain its appeal in the housing market, especially given current high mortgage interest rates and general economic uncertainties. The region's robust housing supply and relative levels of accessibility create a resilient market structure by sustaining buyer demand. This will likely continue to make the Midwest an attractive option, particularly for first-time homebuyers and those seeking budget-friendly housing solutions.