LOS ANGELES, Feb. 12, 2020 /PRNewswire/ -- Slightly higher mortgage interest rates offset steady home prices and held California housing affordability constant during the fourth quarter of 2019. However, more Californians could afford a home purchase compared to a year ago, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.
The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in fourth-quarter 2019 was unchanged from the third quarter of 2019 at 31 percent but was up from 28 percent in the fourth quarter a year ago, according to C.A.R.'s Traditional Housing Affordability Index (HAI). California's housing affordability index hit a peak of 56 percent in the fourth quarter of 2012.
C.A.R.'s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. C.A.R. also reports affordability indices for regions and select counties within the state. The index is considered the most fundamental measure of housing well-being for home buyers in the state.
A minimum annual income of $119,600 was needed to qualify for the purchase of a $607,040 statewide median-priced, existing single-family home in the fourth quarter of 2019. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $2,990, assuming a 20 percent down payment and an effective composite interest rate of 3.89 percent. The effective composite interest rate was 3.85 percent in third-quarter 2019 and 4.95 percent a year ago.
Housing affordability for condominiums and townhomes also improved from a year ago but decreased compared to the third quarter of 2019 because of higher median condominium prices. Forty-one percent of California households earned the minimum income to qualify for the purchase of a $480,000 median-priced condominium/townhome, down from 43 percent in the previous quarter. An annual income of $94,400 was required to make monthly payments of $2,360. Thirty-seven percent of households could afford to buy a condominium/townhome a year ago.
Compared with California, more than half of the nation's households (57 percent) could afford to purchase a $274,900 median-priced home, which required a minimum annual income of $54,000 to make monthly payments of $1,350.
Key points from the fourth-quarter 2019 Housing Affordability report include:
See C.A.R.'s historical housing affordability data.
See first-time buyer housing affordability data.
Leading the way...® in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with more than 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.
CALIFORNIA ASSOCIATION OF REALTORS® | |||||||||
Traditional Housing Affordability Index | |||||||||
Fourth quarter 2019 | |||||||||
STATE/REGION/COUNTY | 4th Qtr. | 3rd Qtr. | 4th Qtr. | Median | Monthly | Minimum | |||
Calif. Single-family home | 31 | 31 | 28 | 607040 | 2990 | 119600 | |||
Calif. Condo/Townhome | 41 | 43 | 37 | 480000 | 2360 | 94400 | |||
Los Angeles Metro Area | 33 | 33 | 30 | 550000 | 2710 | 108400 | |||
Inland Empire | 44 | 44 | 40 | 380000 | 1870 | 74800 | |||
San Francisco Bay Area | 28 | 29 | 22 | 925000 | 4550 | 182000 | |||
United States | 57 | 56 | 54 | 274900 | 1350 | 54000 | |||
San Francisco Bay Area | |||||||||
Alameda | 27 | 26 | 20 | 905000 | 4450 | 178000 | |||
Contra Costa | 39 | 39 | 33 | 662500 | 3260 | 130400 | |||
Marin | 22 | 22 | 19 | 1325000 | 6520 | 260800 | |||
Napa | 30 | 29 | 25 | 715100 | 3520 | 140800 | |||
San Francisco | 18 | 18 | 15 | 1600000 | 7870 | 314800 | |||
San Mateo | 20 | 20 | 15 | 1550000 | 7620 | 304800 | |||
Santa Clara | 22 | 22 | 18 | 1246000 | 6130 | 245200 | |||
Solano | 47 | 47 | 39 | 460000 | 2260 | 90400 | |||
Sonoma | 30 | 28 | 23 | 656360 | 3230 | 129200 | |||
Southern California | |||||||||
Los Angeles | 27 | 25 | 24 | 617310 | 3040 | 121600 | |||
Orange | 26 | 25 | 20 | 828000 | 4070 | 162800 | |||
Riverside | 41 | 41 | 37 | 420000 | 2070 | 82800 | |||
San Bernardino | 51 | 51 | 48 | 318000 | 1560 | 62400 | |||
San Diego | 29 | 29 | 24 | 655000 | 3220 | 128800 | |||
Ventura | 31 | 30 | 29 | 660000 | 3250 | 130000 | |||
Central Coast | |||||||||
Monterey | 24 | 24 | 21 | 655000 | 3220 | 128800 | |||
San Luis Obispo | 29 | 27 | 22 | 617000 | 3030 | 121200 | |||
Santa Barbara | 23 | 22 | 26 | 696250 | 3420 | 136800 | |||
Santa Cruz | 21 | 22 | 12 | 883000 | 4340 | 173600 | |||
Central Valley | |||||||||
Fresno | 49 | 49 | 46 | 289000 | 1420 | 56800 | |||
Kern | 50 | 51 | 53 | 260000 | 1280 | 51200 | |||
Kings | 55 | 55 | 50 | 255000 | 1250 | 50000 | |||
Madera | 51 | 52 | 47 | 290900 | 1430 | 57200 | |||
Merced | 49 | 49 | 40 | 280000 | 1380 | 55200 | |||
Placer | 49 | 48 | 42 | 495500 | 2440 | 97600 | |||
Sacramento | 45 | 45 | 42 | 385000 | 1890 | 75600 | |||
San Benito | 34 | 35 | 28 | 600000 | 2950 | 118000 | |||
San Joaquin | 45 | 44 | 38 | 380000 | 1870 | 74800 | |||
Stanislaus | 48 | 48 | 45 | 335000 | 1650 | 66000 | |||
Tulare | 52 | 51 | 47 | 250000 | 1230 | 49200 | |||
Other Calif. Counties | |||||||||
Amador | 49 | 49 | 45 | r | 320000 | 1570 | 62800 | ||
Butte | 39 | 38 | 34 | 350000 | 1720 | 68800 | |||
Calaveras | 47 | 49 | 45 | 349000 | 1720 | 68800 | |||
El Dorado | 45 | 42 | 42 | 481000 | 2370 | 94800 | |||
Humboldt | 38 | 37 | 33 | 325000 | 1600 | 64000 | |||
Lake | 45 | 47 | 40 | 275000 | 1350 | 54000 | |||
Lassen | 63 | 64 | 66 | 215000 | 1060 | 42400 | |||
Mariposa | 45 | 44 | 38 | 309500 | 1520 | 60800 | |||
Mendocino | 29 | 30 | 23 | 415000 | 2040 | 81600 | |||
Mono | 26 | 17 | 12 | 570000 | 2800 | 112000 | |||
Nevada | 40 | 41 | 35 | 430000 | 2120 | 84800 | |||
Plumas | 52 | 46 | 42 | 275000 | 1350 | 54000 | |||
Shasta | 48 | 47 | 45 | 285000 | 1400 | 56000 | |||
Siskiyou | 50 | 51 | 50 | 230000 | 1130 | 45200 | |||
Sutter | 46 | 47 | 44 | 317450 | 1560 | 62400 | |||
Tehama | 45 | 46 | 46 | 261500 | 1290 | 51600 | |||
Tuolumne | 51 | 49 | 48 | 289000 | 1420 | 56800 | |||
Yolo | 40 | 39 | 37 | 459950 | 2260 | 90400 | |||
Yuba | 47 | 48 | 44 | 305000 | 1500 | 60000 |
r = revised |
SOURCE CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)
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