CNBC's latest ranking exposes the states where every cost is climbing
Inflation is running at its highest level in three years, and for mortgage brokers operating in the country's costliest markets, a new national ranking makes plain just how uneven that burden has become.
CNBC's 2026 America's Top States for Business study — now in its 20th year, measuring 138 metrics across 10 competitiveness categories — has identified the states where household costs are most punishing.
The analysis draws on price data from the Council for Community and Economic Research (C2ER), housing affordability metrics for both owners and renters, and homeowners' insurance premiums based on the most recent available data.
Federal Reserve Chairman Kevin Warsh addressed the stakes bluntly at his Senate confirmation hearing on April 22.
"It's the most regressive tax that anyone in Washington could come up with," he said. "If you were trying to do the most harm to the least well off among us, inflation would be the way to do it."
The Consumer Price Index reached 4.2% year-over-year in May 2026, the steepest reading since 2023, according to the US Bureau of Labor Statistics, and the burden is falling hardest on residents of a familiar group of states.
California leads as insurance costs soar
California ranked as America's most expensive state by a considerable margin, posting a cost-of-living score of just 4 out of 50 points — the only F grade in the country.
Monthly housing costs are the highest in the nation: according to CNBC and C2ER data, 40% of Californians spend more than 30% of their income on housing.
Homeowners' insurance premiums have surged 84% since 2020, and Insurify projects a further 16% increase this year, the steepest projected rise of any state.
Research from Stanford University has found the crisis spreading well beyond wildfire-prone areas. The state's FAIR Plan, intended as the insurer of last resort, now covers approximately 5% of California single-family homes, up from 1.5% in 2020.
Stanford researchers found that 6% of new mortgage originations in California are now backed by FAIR Plan insurance — a signal, the study noted, of deeper structural stress ahead.
As the homeowners' insurance crisis has escalated into a direct mortgage crisis, the practical consequences for originators have intensified.
Damon Germanides, co-founder and broker at Insignia Mortgage in California, previously told Mortgage Professional America that insurance now has to be addressed at the very start of every transaction.
"We get on it early on in the loan process because we don't want the client to have sticker shock when they get their insurance quote, or it could jeopardize the loan because the traditional underwriting matrix for insurance doesn't work anymore," Germanides said.
A multistate squeeze brokers cannot ignore
The affordability pressure extends well beyond the West Coast. New York ranked among the most expensive states, with average Manhattan home prices reaching $2.9 million in the first quarter of 2026, according to C2ER, and average apartment rents in New York City approaching $6,000 per month. Rents statewide are the highest in the nation as a percentage of median income, according to ATTOM Data Solutions.
Florida, once an affordable outlier for its lack of state income tax, now carries the highest homeowners' premiums in the country, according to Insurify, with a further 2% increase projected this year.
Colorado, meanwhile, is absorbing the worst of the national insurance crisis, with average annual premiums reaching nearly $4,000, roughly double the 2020 figure, and another 4% rise expected.
The full list rounds out with Hawaii, Rhode Island, Oregon, Connecticut, Illinois, and Washington, each receiving a D or D+ cost-of-living grade from CNBC.
| # | State | Score / grade | CPI May '26 YoY | Avg 3-BR rent/mo | Avg home price (metro) | Energy bill/mo | Eggs/doz (Q1 2026) | Bread/loaf (Q1 2026) |
|---|---|---|---|---|---|---|---|---|
| 1 | California | 4/50 — F | +3.5% (West) | $3,490 | $1,982,986 (San Jose) | $372.98 | $2.96 | $5.20 |
| 2 | Colorado | 12/50 — D− | +4.2% (Mtn-Plains) | $2,593 | $523,031 (Colo. Springs) | $148.72 | $2.96 | $4.56 |
| 3 | Florida | 13/50 — D− | +3.9% (Southeast) | $2,587 | $935,241 (Ft. Lauderdale) | $230.06 | $3.92 | $4.84 |
| 4 | Hawaii | 14/50 — D | +3.5% (West) | $3,746 | $1,661,193 (Honolulu) | $555.14 | $7.49 | $6.97 |
| 5 | Rhode Island | 15/50 — D | +5.0% (Northeast) | $3,447 | $471,895 (Providence) | $327.71 | $4.83 | $3.95 |
| 6 | Oregon | 15/50 — D | +3.5% (West) | $2,456 | $683,212 (Portland) | $216.52 | $2.96 | $4.58 |
| 7 | Connecticut | 16/50 — D | +5.0% (Northeast) | $3,226 | $913,790 (Stamford) | $340.42 | $5.30 | $4.38 |
| 8 | Illinois | 17/50 — D+ | +5.0% (Midwest) | $2,425 | $642,053 (Chicago) | $188.44 | $4.04 | $4.04 |
| 9 | New York | 17/50 — D+ | +5.1% (NY-NJ metro) | $4,198 | $2,904,444 (Manhattan) | $275.57 | $4.87 | $4.33 |
| 10 | Washington | 17/50 — D+ | +3.5% (West) | $2,632 | $1,252,825 (Seattle) | $211.87 | $2.96 | $4.95 |
Source: CNBC America's Top States for Business 2026; Council for Community and Economic Research (C2ER); Insurify; ATTOM Data Solutions. Rent = 3-bedroom monthly average. CPI = May 2026 year-over-year by BLS region. Home price = representative metro area. Grocery prices = Q1 2026.
According to the Zebra's 2026 State of Insurance: Home report, published in April 2026, 47% of homeowners said they would struggle to meet their mortgage obligations if premiums rose any further.
For brokers in markets where soaring insurance costs are squeezing buyers out of deals, the pattern is a familiar one.
Hector Amendola, president of Panorama Mortgage Group, told Mortgage Professional America earlier in 2026 that the combination of insurance, rates, and home prices is what has driven buyers to the sidelines.
"When your insurance cost goes up 200% from one year to the next, or in some cases even more than that, it's something to be concerned with," Amendola said.
As home price growth continues to trail inflation through 2026, brokers working clients in any of these 10 states face the most compressed affordability environment of the cycle and the ranking from CNBC gives that reality a concrete, state-by-state frame.
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