I’ll admit it – I’m an HGTV fanatic. I love that channel, particularly one of their flagship shows, House Hunters. In it, the main contestants are looking for a new house to buy. A local realtor will show them around to 3 houses within their stated budget, and by the end they will choose which house to purchase. This show is shot all over the United States, in varying degrees of real estate markets. Depending on where the contestants are located, an average $300,000 budget can mean a 1 bedroom condo (in a place like the San Francisco Bay Area) or a detached single family home with a nice sized backyard (in a place like Nashville, TN).
Which brings me to the graphic below. It explains in a nutshell what I see on House Hunters. The Tax Foundation released its most recent data on how far $100 stretches in every state. Living in California I was unsurprised to find that we rank 5th behind Washington, D.C., Hawaii, New York and New Jersey as a place where $100 stretches the least.
More fascinating still was the Tax Foundation’s findings when it looked at how far $100 would stretch within a state’s cities vs. non-metropolitan areas. Even here, California is a loser in the purchasing power battle. Its findings are stated below:
“The yellowest colors on the map, signifying the place where your $100 buys you the least, are in the largest cities in the northeast and California. While cities are almost uniformly more expensive than rural areas due to the higher price of land, some cities – particularly those with relaxed zoning restrictions and a lot of flat land to build on – are cheaper than others….
It’s important to note that price differences do persist across states, even in non-metropolitan areas. $100 still doesn’t go nearly as far in rural California ($102.56) as it does in rural Texas ($114.03). It doesn’t even go as far as it does in San Antonio ($106.27). This suggests that policy – not just geography and urbanization – may play a role in these price differences.”
I supposed that’s the price we pay for living in the “Golden State.”
To see an interactive version of the map above, which provides details of the purchasing power for the areas in each state, click here.