Industry News

Golden State real estate gets more costly

Realtor group index reveals declining affordability

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Housing affordability in California dropped several notches from October 2004 to October 2005, the California Association of Realtors reported Thursday. The percentage of households in California able to afford a median-priced home stood at 15 percent in October, a 4 percentage-point decrease compared to October 2005. This October Housing Affordability Index was unchanged from September, when it also stood at 15 percent, the state Realtor group also reported. CAR's monthly housing affordability index measures the percentage of households that can afford to purchase a median-priced home in California. CAR also reports housing affordability indexes for regions and select counties within the state. The minimum household income needed to purchase a median-priced home at $538,770 in California in October was $128,480, based on an average effective mortgage interest rate of 6.03 percent and assuming a 20 percent down payment. The minimum household income needed to purchase a median-priced...