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Second quarter California housing affordability

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For release:
August 12, 2020

Higher home prices and economic recession dampen California housing affordability in second-quarter 2020, C.A.R. reports

  • Thirty-three percent of California households could afford to purchase the $610,850 median-priced home in the second quarter of 2020, down from 35 percent in first-quarter 2020 but up from 30 percent a year ago.

  • A minimum annual income of $115,200 was needed to make monthly payments of $2,880, including principal, interest and taxes on a 30-year fixed-rate mortgage at a 3.43 percent interest rate.

  • Forty-four percent of home buyers were able to purchase the $480,000 median-priced condo or townhome. An annual income of $90,400 was required to make a monthly payment of $2,260.

LOS ANGELES (Aug. 12) – Higher home prices and lower household income caused by the economic recession dampened California housing affordability in the second quarter of 2020, 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 second-quarter 2020 dipped to 33 percent from 35 percent in the first quarter of 2020 but was up from 30 percent in the second 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 second 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 $115,200 was needed to qualify for the purchase of a $610,850 statewide median-priced, existing single-family home in the second quarter of 2020. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $2,880, assuming a 20 percent down payment and an effective composite interest rate of 3.43 percent. The effective composite interest rate was 3.70 percent in first-quarter 2020 and 4.17 percent in second-quarter 2019. 

Housing affordability for condominiums and townhomes was unchanged from first-quarter 2020, with 44 percent of California households earning the minimum income to qualify for the purchase of a $480,000 median-priced condominium/townhome. An annual income of $90,400 was required to make monthly payments of $2,260. Forty percent of households could afford to buy a median-priced condominium/townhome a year ago.

Compared with California, more than half of the nation’s households (57 percent) could afford to purchase a $291,300 median-priced home, which required a minimum annual income of $54,800 to make monthly payments of $1,370.

Key points from the second-quarter 2020 Housing Affordability report include:

  • When compared to a year ago, housing affordability improved in 44 tracked counties and declined in one county. Affordability remained flat in four counties.

  •  In the San Francisco Bay Area, affordability improved from second-quarter 2019 in every county, except Solano, which was unchanged. San Mateo and San Francisco counties were the least affordable, tied at 19 percent of households able to purchase the median-priced home. Forty-six percent of Solano County households could afford the $485,000 median-priced home, making it the most affordable Bay Area county.
  • Affordability also improved in all Southern California regions, with Orange County being the least affordable (25 percent) and San Bernardino County being the most affordable (54 percent).

  • In the Central Valley region, eight counties experienced an improvement in affordability from a year ago, and three counties stayed flat, San Benito County (39 percent) was the least affordable and Kings County (60 percent) was the most affordable.

  • Housing affordability improved in all four counties in the Central Coast region.

  • During the second quarter of 2020, the most affordable counties in California were Lassen (68 percent), Kings (60 percent), San Bernardino (54 percent), Siskiyou (54 percent), Tehama (54 percent), and Tuolumne (54 percent). The minimum qualifying income was $61,200 or less for each of these counties.

  • Mono (17 percent), San Francisco (19 percent), and San Mateo (19 percent) were the least affordable counties in the state. Both San Mateo and San Francisco had a minimum qualifying income of over $320,000 to purchase a median-priced home in second-quarter 2020; San Francisco County required the highest income of all counties in California at $322,000.

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
Second quarter 2020

STATE/REGION/COUNTY

Q22020

Q12020

 

Q22019

Median Home Price

Monthly Payment Including Taxes & Insurance

Minimum Qualifying Income

Calif. Single-family home

33

35

 

30

 

$610,850

$2,880

$115,200

Calif. Condo/Townhome

44

44

 

40

 

$480,000

$2,260

$90,400

Los Angeles Metro Area

36

35

 

32

 

$548,000

$2,580

$103,200

Inland Empire

46

46

 

42

 

$400,000

$1,880

$75,200

San Francisco Bay Area

28

31

 

24

 

$989,000

$4,660

$186,400

United States

57

59

 

55

 

$291,300

$1,370

$54,800

 

 

 

 

 

 

 

 

 

San Francisco Bay Area

 

 

 

 

 

 

 

 

Alameda

26

28

 

23

 

$990,000

$4,660

$186,400

Contra Costa

37

42

 

35

 

$725,000

$3,410

$136,400

Marin

22

23

 

21

 

$1,460,000

$6,880

$275,200

Napa

33

34

 

28

 

$720,000

$3,390

$135,600

San Francisco

19

20

 

17

 

$1,710,000

$8,050

$322,000

San Mateo

19

20

 

18

 

$1,700,000

$8,010

$320,400

Santa Clara

22

22

 

20

 

$1,380,000

$6,500

$260,000

Solano

46

49

 

46

 

$485,000

$2,280

$91,200

Sonoma

31

32

 

28

 

$679,900

$3,200

$128,000

Southern California

 

 

 

 

 

 

 

 

Los Angeles

32

31

 

29

 

$581,650

$2,740

$109,600

Orange

25

24

 

24

 

$859,000

$4,050

$162,000

Riverside

43

44

 

39

 

$440,000

$2,070

$82,800

San Bernardino

54

53

 

50

 

$324,000

$1,530

$61,200

San Diego

30

30

 

27

 

$670,000

$3,160

$126,400

Ventura

31

32

 

30

 

$690,000

$3,250

$130,000

Central Coast

 

 

 

 

 

 

 

 

Monterey

25

26

 

24

 

$680,000

$3,200

$128,000

San Luis Obispo

31

31

 

25

 

$625,000

$2,940

$117,600

Santa Barbara

31

27

 

20

 

$645,000

$3,040

$121,600

Santa Cruz

23

23

 

17

 

$905,000

$4,260

$170,400

Central Valley

 

 

 

 

 

 

 

 

Fresno

51

52

 

48

 

$300,000

$1,410

$56,400

Glenn

46

46

 

NA

 

$304,250

$1,430

$57,200

Kern

50

52

 

50

 

$271,990

$1,280

$51,200

Kings

60

61

 

55

 

$260,000

$1,220

$48,800

Madera

51

52

 

51

 

$300,000

$1,410

$56,400

Merced

48

48

 

47

 

$285,000

$1,340

$53,600

Placer

45

46

 

45

 

$515,000

$2,430

$97,200

Sacramento

46

47

 

44

 

$405,000

$1,910

$76,400

San Benito

39

42

 

35

 

$600,000

$2,830

$113,200

San Joaquin

45

46

 

44

 

$409,000

$1,930

$77,200

Stanislaus

49

51

 

48

 

$352,000

$1,660

$66,400

Tulare

52

53

 

50

 

$259,580

$1,220

$48,800

Other Calif. Counties

 

 

 

 

 

 

 

 

Amador

53

53

 

46

 

$335,000

$1,580

$63,200

Butte

38

41

 

35

 

$379,880

$1,790

$71,600

Calaveras

49

48

 

46

 

$349,000

$1,640

$65,600

Del Norte

43

50

 

NA

 

$282,450

$1,330

$53,200

El Dorado

44

47

 

40

 

$515,000

$2,430

$97,200

Humboldt

43

43

 

37

 

$322,500

$1,520

$60,800

Lake

47

52

 

44

 

$302,500

$1,420

$56,800

Lassen

68

64

 

63

 

$199,500

$940

$37,600

Mariposa

43

46

 

45

 

$349,500

$1,650

$66,000

Mendocino

38

36

 

29

 

$410,000

$1,930

$77,200

Mono

17

17

 

15

 

$718,750

$3,380

$135,200

Nevada

45

46

 

40

 

$433,750

$2,040

$81,600

Plumas

52

48

 

37

 

$289,850

$1,370

$54,800

Shasta

52

52

 

47

 

$295,000

$1,390

$55,600

Siskiyou

54

52

 

49

 

$230,000

$1,080

$43,200

Sutter

50

50

 

46

 

$325,000

$1,530

$61,200

Tehama

54

49

 

47

 

$238,500

$1,120

$44,800

Tuolumne

54

54

 

48

 

$304,000

$1,430

$57,200

Yolo

43

43

 

40

 

$457,000

$2,150

$86,000

Yuba

52

53

 

46

 

$324,950

$1,530

$61,200

NA = not available

 

 

 


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