- Solano and Contra Costa counties remain the most affordable in the Bay Area.
- CAR's findings for Los Angeles County should be taken lightly.
- CAR's affordability findings assume buyers can put 20 percent down.
Los Angeles County isn’t know for its affordability, but compared with the Bay Area, it’s much more attainable.
In eight of the nine Bay Area counties, homebuyers must earn more than $100,000 annually to qualify for the purchase of a median-priced, single-family home.
Somewhat surprisingly this is not the case in Los Angeles County, where buyers must earn $96,420, according to a California Association of Realtors (CAR) index.
Bay Area home affordability
With a minimum qualifying income of $71,200, Solano County represents the only Bay Area county where a buyer that earns less than $100,000 annually can afford the area’s median-priced home, which sits at $356,000.
CAR estimates that 45 percent of California households could qualify for the purchase of a single-family home in Solano County and that their monthly payments would be $1,780. The payment figure assumes a buyer puts 20 percent down and utilizes a 30-year, fixed-rate loan with an interest rate of 4.07 percent.
The next most affordable region in the Bay Area is Contra Costa County, with 37 percent of California households able to qualify for a median, single-family home purchase.
Buyers in Contra Costa must earn at least $105,350 to purchase a $526,000 home. Their monthly payment would be slightly more than $2,600.
One attractive city in Contra Costa is Concord, the county’s largest market.
“You can save $150,000 going to Concord,” said Renee White, an agent with Keller Williams Realty. “There’s a wide price point.”
CAR noted that Contra Costa recently saw notable quarter-to-quarter improvement in housing affordability due to flat home prices and lower interest rates.
LA County stats a bit deceiving
CAR states that 27 percent of California households can qualify for the purchase of a single-family home in LA County. This is mainly because the association’s findings were based on a median home price of $481,490.
Even in further out LA County submarkets median prices are above this number. In Santa Clarita and San Fernando median home values sat at $510,542 and $554,208, respectively, entering 2016. Zillow cites $515,600 as the county’s median price.
If CAR assumed an overall median value of more than $500,000 the required household income to qualify for a home purchase would rise beyond $100,000.