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First quarter 2022 housing affordability

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For release:
May 3, 2022

 California housing affordability shrinks in first-quarter 2022 as home prices set record highs and interest rates rise, C.A.R. reports

  • Twenty-four percent of California households could afford to purchase the $797,000 median-priced home in the first quarter of 2022, down from 25 percent in fourth-quarter 2021 and down from 27 percent in first-quarter 2021.

  • A minimum annual income of $158,000 was needed to make monthly payments of $3,950, including principal, interest and taxes on a 30-year fixed-rate mortgage at a 3.97 percent interest rate.

  • Thirty-two percent of home buyers were able to purchase the $640,000 median-priced condo or townhome. A minimum annual income of $126,800 was required to make a monthly payment of $3,170.

     

  • Infographic: https://www.car.org/Global/Infographics/Q1-2022-HAI

LOS ANGELES (May 3) – As California’s median home price set a new high in March and interest rates reached their highest levels in more than two years, the housing affordability outlook for Californians was diminished in the first quarter of 2022, 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 2022 ticked down to 24 percent from 25 percent in the fourth quarter of 2021 and was down from 27 percent in the first quarter of 2021, according to C.A.R.’s Traditional Housing Affordability Index (HAI). The first-quarter 2022 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 $158,000 was needed to qualify for the purchase of a $797,000 statewide median-priced, existing single-family home in the first quarter of 2022. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,950, assuming a 20 percent down payment and an effective composite interest rate of 3.97 percent. The effective composite interest rate was 3.28 percent in fourth-quarter 2021 and 3.08 percent in first-quarter 2021. 

With the median price of condominiums and townhomes reaching another record high in first-quarter 2022, affordability for condos and townhomes dropped from the previous quarter. Thirty-two percent of California households earned the minimum income to qualify for the purchase of a $640,000 median-priced condo/townhome in the first quarter of 2022, which required an annual income of $126,800 to make monthly payments of $3,170. The first quarter 2022 figure was down from 40 percent a year ago.

Compared with California, nearly half of the nation’s households could afford to purchase a $368,200 median-priced home, which required a minimum annual income of $73,200 to make monthly payments of $1,830. Nationwide affordability was down from 54 percent a year ago.

Key points from the first-quarter 2022 Housing Affordability report include:

  • Compared to the previous quarter, housing affordability in the first quarter of 2022 declined in all but two of 51 counties. Affordability was improved in Mendocino County and remained unchanged in Humboldt County.
  • In the nine-county San Francisco Bay Area, affordability declined from the previous quarter in all counties. Alameda County was the least affordable Bay Area county, at just 17 percent of households able to purchase the $1,370,500 median-priced home. Thirty-seven percent of Solano County households could afford the $600,000 median-priced home, making it the most affordable Bay Area county.

  • In the Southern California region, housing affordability deteriorated in all counties. Orange County was the least affordable at 13 percent, while San Bernardino County was the most affordable at 39 percent of households able to purchase the $460,000 median-priced home.

     

  • In the Central Valley region, Kings County was the most affordable at 51 percent, and San Benito was the least affordable at 24 percent.

  • In the Central Coast region, Santa Barbara County was the least affordable at 12 percent, and San Luis Obispo County was the most affordable at 18 percent.

     

  • For the state as a whole, Lassen (61 percent) remained the most affordable county in California in the first quarter of 2022, followed by Kings (51 percent), Shasta (42 percent) and Siskiyou (42 percent). Lassen also required the lowest minimum qualifying income ($48,400) of all counties in California to purchase a median-priced home.

     

  • Mono (7 percent), Santa Barbara (12 percent), Santa Cruz (13 percent) and Orange (13 percent) were the least affordable counties in the state, with each of them requiring at least a minimum income of $205,600 to purchase a median-priced home in the county.San Mateo had the highest minimum qualifying income to buy a median-priced home in first-quarter 2022, surpassing the $400,000 benchmark for the first time and reaching a record high at $435,200. Three other counites in California that also had a minimum qualifying income of over $300,000 in first-quarter 2022 were Santa Clara ($371,600), San Francisco ($366,800), and Marin ($329,200).

     

  • Housing affordability declined the most on a year-over-year basis in Yuba, dropping 12 points from the previous year. Four other counties that also recorded double-digit annual drops include Plumas (-11 points), Tuolumne (-11 points), Tehama (-10 points), and Yolo (-10 points). Higher interest rates and home price surges from a year ago were primary factors that led to the drop in affordability in these counties.

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 217,000 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 2022

 

First Quarter 2022

C.A.R. Traditional Housing Affordability Index

STATE/REGION/COUNTY

Qtr. 1

2022

Qtr. 4 2021

 

Qtr. 1

2021

Median Home Price

Monthly Payment Including Taxes & Insurance

Minimum Qualifying Income

Calif. Single-family home

24

25

 

27

 

$797,000

$3,950

$158,000

Calif. Condo/Townhome

32

36

 

40

 

$640,000

$3,170

$126,800

Los Angeles Metro Area

24

26

 

29

 

$736,000

$3,650

$146,000

Inland Empire

31

35

 

39

 

$560,000

$2,780

$111,200

San Francisco Bay Area

20

23

 

23

 

$1,350,000

$6,690

$267,600

United States

47

51

r

54

 

$368,200

$1,830

$73,200

 

 

 

 

 

 

 

 

 

San Francisco Bay Area

 

 

 

 

 

 

 

 

Alameda

17

20

 

22

 

$1,370,500

$6,790

$271,600

Contra Costa

30

33

 

32

 

$910,000

$4,510

$180,400

Marin

21

23

 

22

 

$1,660,000

$8,230

$329,200

Napa

20

24

 

24

 

$965,000

$4,780

$191,200

San Francisco

20

21

 

20

 

$1,850,000

$9,170

$366,800

San Mateo

18

19

 

19

 

$2,195,000

$10,880

$435,200

Santa Clara

20

22

 

22

 

$1,875,000

$9,290

$371,600

Solano

37

42

 

44

 

$600,000

$2,970

$118,800

Sonoma

23

28

 

27

 

$825,000

$4,090

$163,600

Southern California

 

 

 

 

 

 

 

 

Los Angeles

20

21

 

24

 

$792,470

$3,930

$157,200

Orange

13

17

 

20

 

$1,260,000

$6,250

$250,000

Riverside

28

32

 

36

 

$607,000

$3,010

$120,400

San Bernardino

39

42

 

45

 

$460,000

$2,280

$91,200

San Diego

19

23

 

25

 

$905,000

$4,490

$179,600

Ventura

21

24

 

27

 

$882,070

$4,370

$174,800

Central Coast

 

 

 

 

 

 

 

 

Monterey

16

19

 

17

 

$885,000

$4,390

$175,600

San Luis Obispo

18

22

 

25

 

$852,250

$4,220

$168,800

Santa Barbara

12

20

 

14

 

$1,130,000

$5,600

$224,000

Santa Cruz

13

17

 

18

 

$1,425,000

$7,060

$282,400

Central Valley

 

 

 

 

 

 

 

 

Fresno

37

40

 

46

 

$405,000

$2,010

$80,400

Glenn

36

43

 

44

 

$360,000

$1,780

$71,200

Kern

38

43

 

47

 

$370,000

$1,830

$73,200

Kings

51

54

 

58

 

$325,000

$1,610

$64,400

Madera

38

42

 

46

 

$415,000

$2,060

$82,400

Merced

40

45

 

46

 

$390,000

$1,930

$77,200

Placer

34

39

 

39

 

$685,000

$3,400

$136,000

Sacramento

34

39

 

41

 

$545,000

$2,700

$108,000

San Benito

24

27

 

31

 

$847,500

$4,200

$168,000

San Joaquin

34

38

 

42

 

$520,000

$2,580

$103,200

Stanislaus

36

40

 

44

 

$460,000

$2,280

$91,200

Tulare

41

44

 

47

 

$343,460

$1,700

$68,000

Far North

 

 

 

 

 

 

 

 

Butte

33

35

 

37

 

$450,000

$2,230

$89,200

Lassen

61

63

 

62

 

$245,000

$1,210

$48,400

Plumas

36

39

 

47

 

$430,000

$2,130

$85,200

Shasta

42

45

 

48

 

$380,000

$1,880

$75,200

Siskiyou

42

44

 

49

 

$310,000

$1,540

$61,600

Tehama

35

40

 

46

 

$355,000

$1,760

$70,400

Other Calif. Counties

 

 

 

 

 

 

 

 

Amador

40

43

 

44

 

$425,000

$2,110

$84,400

Calaveras

35

40

 

41

 

$489,500

$2,430

$97,200

Del Norte

32

39

 

36

 

$390,000

$1,930

$77,200

El Dorado

29

37

 

36

 

$706,820

$3,500

$140,000

Humboldt

30

30

 

39

 

$430,000

$2,130

$85,200

Lake

38

43

 

46

 

$354,000

$1,750

$70,000

Mariposa

29

30

 

37

 

$442,500

$2,190

$87,600

Mendocino

24

22

 

27

 

$503,000

$2,490

$99,600

Mono

7

13

 

3

 

$1,037,500

$5,140

$205,600

Nevada

33

37

 

37

 

$550,000

$2,730

$109,200

Sutter

39

41

 

45

 

$426,000

$2,110

$84,400

Tuolumne

38

45

 

49

 

$429,500

$2,130

$85,200

Yolo

28

33

 

38

 

$630,000

$3,120

$124,800

Yuba

33

36

 

45

 

$430,000

$2,130

$85,200

r = revised

 

Traditional Housing Affordability Indices (HAI) were calculated based on the following effective composite interest rates: 3.97% (1Qtr. 2022), 3.28% (4Qtr. 2021) and 3.08% (1Qtr. 2021).

 


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