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Real estate still out of reach for Californians

Income needed to buy home rises to $109,590 year-over-year

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The percentage of households in California able to afford a median-priced home stood at 18 percent in July, unchanged from the previous month, but was 9 percentage points lower than July 2003, according to a report released today by the California Association of Realtors. The minimum household income needed to purchase a median-priced home of $463,540 in California in July was $109,590, based on an average effective mortgage interest rate of 5.93 percent and assuming a 20 percent down payment. This figure was up from $86,120 in July 2003–when the median price of a home was $381,940 and the prevailing interest rate was 5.39 percent–but fell from June 2004's minimum household income of $111,690. The minimum household income needed to purchase a median-priced home at $191,300 in the U.S. in July 2004 was $45,230. At 42 percent, the High Desert region was the most affordable region in the state, followed by the Sacramento and Central Valley regions at 26 percent. The San...