Industry News

California real estate affordability drops

24% of first-time buyers can afford median-priced home

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Housing affordability in California dropped 4 percentage points in the third quarter compared to the same quarter last year, the California Association of Realtors trade group reported today. The percentage of first-time buyers in California who can afford a median-priced home fell to 24 percent in the third quarter, according to the association's First-time Buyer Housing Affordability Index. First-time buyers needed a minimum household income of $98,890 to buy a home priced at $478,710 in the third quarter, based on an adjustable interest rate of 6.58 percent and assuming a 10 percent down payment, according to the report. First-time buyers typically purchase a home equal to 85 percent of the prevailing median price, according to the report. The monthly payment including taxes and insurance was $3,300 for the third quarter. Affordability declined 7 percentage points in the High Desert and Riverside/San Bernardino regions; dropped 6 percentage points in the Santa Clara County region;...