California households are nearly $74,000 short of the $127,950 qualifying income needed to purchase a median home in the state, according to the California Association of Realtors Homebuyer Income Gap Index report for the third quarter of 2005, released today.

With a median household income of $54,140, California households are $73,810 short of the $127,950 qualifying income needed to purchase a median-priced home at $545,910 in California, C.A.R. said today.

The Homebuyer Income Gap Index for California increased 33.7 percent during the third quarter of 2005 compared to the third quarter of 2004, when the gap stood at $55,220, the median household income was $52,940, and qualifying income needed to purchase a median-priced home at $461,850 was $108,150, the organization said.

According to the report, potential home buyers in the Central Valley, with a median household income of $41,460, had the smallest income gap at $43,170, and needed a qualifying income of $84,630 to purchase a median-priced home at $361,090.

The San Francisco Bay Area had the highest gap in the state at $100,670, where potential home buyers had a median household income of $68,520 but needed a qualifying income of $169,180 to purchase a median-priced home at $721,850.

The association’s Homebuyer Income Gap Index is a quarterly analysis of the difference between the median household income and the qualifying income needed to purchase a median-priced, single-family home for the state and for select regions within the state.

The HIGI is calculated with the same assumptions used to generate CAR’s monthly Housing Affordability Index: a 20 percent down payment and a monthly payment for principal, interest, taxes and insurance that is no more than 30 percent of a household’s income.

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