Q1 home affordability improves to highest level in a year
Almost one of every three households can afford a home
Slightly lower mortgage rates and more stable prices helped boost home affordability in California during the first quarter to the highest level in a year.
Affordability climbed to 32% during the first three months of the year, compared to 28% in the fourth quarter and 31% for the same period last year, according to the California Association of Realtors. The state’s affordability reached a modern-day high of 56% in first-quarter 2012.
The affordability index is based on the number of households that can afford the median-priced home in the state, regardless of where they live. The average household needed to earn at least $114,860 per year to be able to purchase the $545,820 median-priced home during the first quarter.
The monthly payment — assuming a 20% down payment and 4.62% interest rate for a 30-year mortgage — would be $2,870. The payment includes insurance.
Affordability improved in 28 counties, while buying a home become pricier in 16 counties.
San Francisco and Santa Cruz were the least affordable housing market at 17%, followed by San Mateo County at 18%.
Lassen County was the most affordable county in the state, with 63% of families able to purchase. Kings (57%%) and Siskiyou (53%) were the second- and third-most affordable counties in the state, where annual income of $47,340 or less opens to the door to ownership.
Photo of a cluster of homes in Simi Valley by Trekandshoot/Shutterstock
Affordability by quarter
- Q1 2019 32% 32%
- Q4 2018 28% 28%
- Q1 2018 31% 31%
About the author
Ron Trujillo, an award-winning business journalist-turned-public relations executive, is the editor-owner of CalHomeNews and can be reached at firstname.lastname@example.org.
Affordability by county and income needed to purchase median-priced home: