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Higher home prices substantially diminish California housing affordability in first quarter 2021, C.A.R. reports


LOS ANGELES, May 11, 2021 /PRNewswire/ -- Housing affordability in California remained at the lowest level since mid-2018 as higher home prices fueled by a shortage of homes for sale pushed the state's median home price more than 22 percent higher on a year-over-year basis, resulting in an 8 percentage-point annual decline in California's housing affordability index in the first quarter of 2021, 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 first-quarter 2021 dropped to 27 percent from 35 percent in the first quarter of 2020 and was unchanged from the fourth quarter of 2020, according to C.A.R.'s Traditional Housing Affordability Index (HAI). The first-quarter 2021 figure is less than half of the affordability index peak of 56 percent in the first 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 $131,200 was needed to qualify for the purchase of a $720,490 statewide median-priced, existing single-family home in the first quarter of 2021. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,280, assuming a 20 percent down payment and an effective composite interest rate of 3.08 percent. The effective composite interest rate was 2.96 percent in fourth-quarter 2020 and 3.70 percent in first-quarter 2020. 

Housing affordability for condominiums and townhomes also declined in first-quarter 2021 compared to a year ago, with 40 percent of California households earning the minimum income to qualify for the purchase of a $535,000 median-priced condominium/townhome, down from 44 percent a year ago and from 41 percent in fourth-quarter 2020. An annual income of $97,600 was required to make monthly payments of $2,440.

Compared with California, more than half of the nation's households (54 percent) could afford to purchase a $319,200 median-priced home, which required a minimum annual income of $58,000 to make monthly payments of $1,450. Nationwide affordability also fell from 59 percent a year ago.

Key points from the first-quarter 2021 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
First quarter 2021

STATE/REGION/COUNTY

Qtr. 1

2021

Qtr. 4

2020


Qtr. 1

2020


Median Home Price

Monthly Payment Including Taxes & Insurance

Minimum Qualifying Income

Calif. Single-family homes

27

27


35


$720,490

$3,280

$131,200

Calif. Condo/Townhomes

40

41


44


$535,000

$2,440

$97,600

Los Angeles Metro Area

29

30


35


$650,000

$2,960

$118,400

Inland Empire

39

41


46


$475,000

$2,160

$86,400

San Francisco Bay Area

23

24


31


$1,157,000

$5,270

$210,800

United States

54

55


59


$319,200

$1,450

$58,000










San Francisco Bay Area









Alameda

22

23


28


$1,109,000

$5,050

$202,000

Contra Costa

32

34


42


$835,000

$3,800

$152,000

Marin

22

22


23


$1,530,000

$6,970

$278,800

Napa

24

29


34


$901,500

$4,110

$164,400

San Francisco

20

20


20


$1,745,000

$7,950

$318,000

San Mateo

19

20


20


$1,850,000

$8,430

$337,200

Santa Clara

22

22


22


$1,500,000

$6,830

$273,200

Solano

44

45


49


$525,000

$2,390

$95,600

Sonoma

27

28


32


$742,500

$3,380

$135,200

Southern California









Los Angeles

25

24


31


$682,360

$3,110

$124,400

Orange

20

22


24


$1,000,000

$4,560

$182,400

Riverside

36

39


44


$520,000

$2,370

$94,800

San Bernardino

45

48


53


$399,000

$1,820

$72,800

San Diego

25

26


30


$763,500

$3,480

$139,200

Ventura

27

27


32


$769,000

$3,500

$140,000

Central Coast









Monterey

17

18


26


$865,000

$3,940

$157,600

San Luis Obispo

25

25


31


$709,750

$3,230

$129,200

Santa Barbara

14

16


27


$1,060,000

$4,830

$193,200

Santa Cruz

18

19


23


$1,100,000

$5,010

$200,400

Central Valley









Fresno

46

48


52


$340,000

$1,550

$62,000

Glenn

44

47


46


$320,000

$1,460

$58,400

Kern

47

48


52


$300,180

$1,370

$54,800

Kings

58

57


61


$282,500

$1,290

$51,600

Madera

46

49


52


$349,000

$1,590

$63,600

Merced

46

45


48


$315,000

$1,440

$57,600

Placer

39

42


46


$599,000

$2,730

$109,200

Sacramento

41

43


47


$465,000

$2,120

$84,800

San Benito

31

31


42


$718,000

$3,270

$130,800

San Joaquin

42

42


46


$442,250

$2,020

$80,800

Stanislaus

44

46


51


$400,000

$1,820

$72,800

Tulare

47

49


53


$300,000

$1,370

$54,800

Far North









Butte

37

35


41


$400,000

$1,820

$72,800

Lassen

62

67


64


$249,000

$1,130

$45,200

Plumas

47

45


48


$337,500

$1,540

$61,600

Shasta

48

49


52


$335,000

$1,530

$61,200

Siskiyou

49

48


52


$266,000

$1,210

$48,400

Tehama

46

45


49


$290,000

$1,320

$52,800

Other Calif. Counties









Amador

44

50


53


$404,570

$1,840

$73,600

Calaveras

41

44


48


$427,000

$1,950

$78,000

Del Norte

36

36


50


$349,000

$1,590

$63,600

El Dorado

36

41


47


$620,000

$2,820

$112,800

Humboldt

39

38


43


$361,000

$1,640

$65,600

Lake

46

46


52


$317,000

$1,440

$57,600

Mariposa

37

41


46


$400,000

$1,820

$72,800

Mendocino

27

28


36


$520,000

$2,370

$94,800

Mono

3

11


17


$1,450,000

$6,610

$264,400

Nevada

37

40


46


$525,000

$2,390

$95,600

Sutter

45

46


50


$365,500

$1,670

$66,800

Tuolumne

49

50


54


$350,000

$1,590

$63,600

Yolo

38

38


43


$515,000

$2,350

$94,000

Yuba

45

49


53


$370,000

$1,690

$67,600

 

SOURCE CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)


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