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By Giulia Carbonaro
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Homeownership, long considered a cornerstone of the American dream, has slipped out of reach for millions of Americans since the pandemic, as home prices and borrowing costs have skyrocketed, outpacing wage growth.
But while the housing affordability crisis is a problem affecting the entire nation, there are parts of the country where the American dream—with its promises of freedom and happiness through hard work and financial independence—still survives, and where homeownership does not feel completely unattainable.
The Newsweek American Dream Index, an analysis of 33,772 U.S. ZIP codes based on six pillars of opportunities considered crucial to achieve the American dream, shows enormous variation between counties. While some areas are struggling badly on housing access, others remain surprisingly affordable and attainable.
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Understanding the American Dream Index
The index gives every one of America’s 33,772 ZIP codes a single score from 0 to 100. Readers can think of 50 as the national middle: any score higher than that, and opportunity is stronger than average; lower and it’s weaker.
The score about housing access answers the question, can a household on a normal income actually afford to live there?
The scores can be interpreted as follows:
- 65 and over: Thriving
- 55 to 64: Doing Well
- 45 to 54: Holding Steady
- 35 to 44: Facing Challenges
- 35 and less: Struggling
Every score is built from public, free-to-use data. Newsweek used a combination of median home value-to-income ratio, gross rent as 35 percent or more of income, and owner-occupancy rate to determine housing access scores.
The Counties Where Homeownership Is Still Attainable—and Affordable
Based on Newsweek’s analysis, these are the 20 counties with the highest levels of housing access:
- Los Alamos County, NM: 87.8
- Hanson County, SD: 85.9
- Nuckolls County, NE: 85.4
- Sheridan County, ND: 82.3
- Jones County, SD: 81.2
- Jerauld County, SD: 80.4
- McPherson County, SD: 79.7
- Harper County, OK: 79.1
- Calhoun County, IL: 78.8
- Deuel County, NE: 78.4
- Stanton County, KS: 78.3
- Roberts County, TX: 78.2
- Kent County, TX: 78.2
- Winkler County, TX: 77.6
- Edwards County, TX: 77.4
- Crane County, TX: 76.7
- Stonewall County, TX: 76.6
- Crockett County, TX: 76.1
- Pope County, IL: 75.8
- Wichita County, KS: 75.7
A glance at this list makes one thing immediately clear: most of the counties where homeownership is still attainable are concentrated in the South and the Midwest—regions where housing is traditionally more affordable, and where building new homes is easier due to less strict zoning rules, faster permitting and approvals, an abundance of developable land, and lower land and construction costs.
Significantly, however, this list does not include Southern markets in Florida, Tennessee, and Texas which were popular during the pandemic, as some might have expected: affordability has deteriorated sharply as demand has surged faster than builders can add supply.
Even as demand has been shrinking since the end of the pandemic and inventory has surged, pushing prices down, these markets remain dramatically more expensive than they were in 2019.
Where the American Dream of Owning a Home Is Vanishing
The 20 counties with the lowest housing access scores, according to Newsweek’s analysis, are concentrated in coastal areas in the Northeast and the West, though there are exceptions. These are:
- Harrisonburg City County, VA: 1.0
- Kings County, NY: 2.0
- New York County, NY: 2.2
- Bronx County, NY: 4.0
- San Francisco County, CA: 6.5
- Clarke County, GA: 7.4
- Suffolk County, MA: 8.1
- Los Angeles County, CA: 8.2
- Queens County, NY: 9.0
- Hudson County, NJ: 9.7
- San Mateo County, CA: 10.7
- Marin County, CA: 10.8
- Eagle County, CO: 10.9
- Santa Cruz County, CA: 10.9
- Benton County, OR: 11.3
- Monterey County, CA: 11.4
- Orange County, CA: 11.5
- Monroe County, FL: 11.5
- Oktibbeha County, MS: 11.5
- Tunica County, MS: 11.8
Clarke County, Georgia, and Monroe County, Florida, are exceptions in this list dominated by Western and Northeastern markets. In Clarke County, the University of Georgia creates constant competition for a limited housing stock from students, faculty and staff.
Monroe County’s poor housing-access score reflects the unique challenges of life in the Florida Keys; as the county is made up largely of a narrow chain of islands, it cannot easily build its way out of housing shortages. The county’s tourism-driven economy, and intense demand from retirees and affluent buyers, have also contributed to pushing homeownership out of reach for many local workers.
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What Is Behind This Geographical Divide?
Experts have observed a widening regional divide in the U.S. housing market since the pandemic—and this is reflected in the American Dream Index as well.
"The South has more housing access due to high construction rates, which increase supply. The Midwest, on the other hand, is affordable due to low demand," Chen Zhao, Redfin’s head of economic research, told Newsweek, commenting on the index. "Fewer people want to live there due to limited job opportunities, which makes those places more affordable," she added.
The expensive coastal areas like Los Angeles and New York "are costly due to high demand, Zhao said, because big coastal cities tend to be job centers." Couple that with low supply—as it is very difficult to build there, she added—and you have a recipe for home price hikes.
"The coastal West and the Northeast both see high home prices and scarce inventory, driven in large part by decades of underbuilding relative to job and population growth," Hannah Jones, senior economist at Realtor.com, told Newsweek.
"These regions are anchored by dense, high-wage economic hubs—tech in the Bay Area, finance in New York and Boston, government and tech in D.C.—that draw a steady stream of high earners. That demand bids up prices across the board, including for renters and lower-income buyers competing for the same limited stock," she added.
Zoning is a big part of why supply hasn’t kept pace in the Northeast and coastal West, Jones said.
"Much of the Northeast and coastal West is built out with single-family zoning, height limits, and lengthy permitting and environmental review processes that make it slow and expensive to add density," she explained.
"Land-use restrictions in these areas are often decades old and were designed around a much smaller population, so even when demand rises sharply, the housing stock can’t expand quickly to absorb it."
This has pushed the affordability crunch outward, Jones said.
"As buyers get priced out of city centers, they push into second- and third-tier metros and exurbs within commuting range, which drives up prices there too. That's part of why the ‘least accessible’ list isn’t limited to San Francisco and New York proper, it also picks up spots which absorb overflow demand," she said.
Rural counties, on the other hand, "look more accessible mainly because they sidestep both problems at once: land is more affordable and plentiful, so new construction is easier and less expensive to add, and they aren’t magnets for high-earning transplants who can outbid local buyers," Jones said.
"It’s less that these places are ‘outperforming expectations’ and more that they simply don’t face the pressure driving the divide elsewhere."
Contact Newsweek editors on this story: Ben Kelly and James Debens
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