California Homes Less Affordable in 4Q12
The purchase of a California home became less affordable in 4Q12 as inventory challenges drove prices higher in the state. The California Association of Realtors Traditional Housing Affordability Index found that only 48% of buyers could purchase a median-priced existing home there, down from 49% in 3Q12 and 55% in 4Q11.
CAR said buyers needed to earn a minimum annual income of $66,940 to purchase a home valued at the statewide median of $353,190. Based on an 80% loan-to-value ratio and a 3.49% interest rate, the monthly payments would be $1,670 (CAR said included taxes and insurance in its calculation).
The areas which were the most affordable in 4Q12 were San Bernardino in Southern California and Kings County in the Central Valley, both with a 76 HAI. At the other end of the scale was San Francisco, with a 22 HAI.
The Bay Area’s regional HAI was 34, while in Los Angeles it was 50 and the Inland Empire 67. All three were down one point from 3Q12. Los Angeles and the Bay Area were down six points from 4Q11, while the Inland Empire was down four points.