Entry-level housing affordability reaches 64 percent
C.A.R. reports entry-level housing affordability reached 64 percent in the third quarter of 2009
LOS ANGELES, CA – November 13, 2009 – (RealEstateRama) — The percentage of households that could afford to buy an entry-level home in California stood at 64 percent in the third quarter of 2009, compared with 55 percent (revised) for the same period a year ago, according to a report released today by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.).
C.A.R.’s First-time Buyer Housing Affordability Index (FTB-HAI) measures the percentage of households that can afford to purchase an entry-level home in California. C.A.R. also reports first-time buyer indexes for regions and select counties within the state. The Index is the most fundamental measure of housing well-being for first-time buyers in the state.
The minimum household income needed to purchase an entry-level home at $247,150 in California in the third quarter of 2009 was $43,500, based on an adjustable interest rate of 4.79 percent and assuming a 10 percent down payment. First-time buyers typically purchase a home equal to 85 percent of the prevailing median price. The monthly payment including taxes and insurance was $1,450 for the third quarter of 2009.
At $43,500, the minimum qualifying income was 19 percent lower than a year earlier when households needed $53,700 to qualify for a loan on an entry-level home. Recent decreases in home prices and mortgage rates have brought affordability into better alignment with income levels of the typical California households, where the median household income is $61,030.
The First-time Buyer Housing Affordability Index declined 3 percentage points in the third quarter of this year compared with the second quarter of 2009, due to a 10.2 percent increase in the price of an entry-level home.
At 85 percent, the High Desert region was the most affordable area in the state. The San Luis Obispo County region was the least affordable in the state at 47 percent, followed by the San Francisco Bay region at 49 percent.
Leading the way…® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with more than 167,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.
C.A.R. First-time Buyer Housing Affordability Index
|
C.A.R. Region |
Q3 2009 |
Q2 2009 |
Q3 2008 |
||
|
California |
64 |
67 |
55 |
r |
|
|
California – Condos |
68 |
70 |
59 |
r |
|
|
United States |
76 |
76 |
70 |
r |
|
|
High Desert |
85 |
86 |
74 |
r |
|
|
Los Angeles County |
52 |
56 |
44 |
r |
|
|
Monterey Region |
66 |
71 |
54 |
r |
|
|
Northern California |
63 |
62 |
56 |
r |
|
|
Northern Wine Country |
58 |
59 |
52 |
r |
|
|
Orange County |
51 |
53 |
46 |
r |
|
|
Palm Springs/Lower Desert |
74 |
76 |
61 |
r |
|
|
Riverside/San Bernardino |
78 |
79 |
68 |
r |
|
|
Sacramento County |
78 |
79 |
72 |
r |
|
|
San Diego County |
56 |
59 |
51 |
||
|
San Francisco Bay |
49 |
55 |
38 |
r |
|
|
San Luis Obispo County |
47 |
50 |
41 |
r |
|
|
Santa Barbara Area |
52 |
55 |
46 |
r |
|
|
Santa Clara County |
53 |
58 |
41 |
r |
|
|
Southern California |
64 |
67 |
54 |
r |
|
|
Ventura County |
56 |
59 |
53 |
r |
|
|
County |
|||||
|
Alameda |
52 |
55 |
42 |
r |
|
|
Contra Costa |
42 |
43 |
33 |
r |
|
|
Fresno |
76 |
78 |
67 |
r |
|
|
Marin |
37 |
37 |
26 |
r |
|
|
Merced |
83 |
84 |
76 |
r |
|
|
Riverside |
78 |
79 |
68 |
r |
|
|
San Bernardino |
81 |
82 |
70 |
r |
|
|
San Francisco |
35 |
36 |
28 |
r |
|
|
San Mateo |
40 |
39 |
32 |
r |
|
|
Santa Cruz |
43 |
46 |
36 |
r |
|
|
Sonoma |
60 |
62 |
54 |
r |
* — percentage of California households that can afford to purchase an entry-level home
r – revised
Source: CALIFORNIA ASSOCIATION OF REALTORS®
|
C.A.R. Region |
Housing |
Entry-Level Price |
Monthly Payment Including Taxes & Insurance |
Minimum |
Source: CALIFORNIA ASSOCIATION OF REALTORS®
Quick Facts:
· C.A.R. First-time Buyer Housing Affordability Index stood at 64 percent in the third quarter of 2009 compared with 55 percent (revised) in the third quarter of 2008
· The median price of an entry-level home in California was $247,150 in the third quarter of 2009
· The estimated monthly payment including taxes and insurance was $1,450 in the third quarter of 2009
· The minimum household income needed to purchase an entry-level home in California in the third quarter of 2009 was $43,500
