• Thirty-one percent of California households could afford to purchase the $613,470 median-priced home in the third quarter of 2019, up from 30 percent in second-quarter 2019 and up from 27 percent a year ago.
  
  
• A minimum annual income of $120,400 was needed to make monthly payments of $3,010, including principal, interest and taxes on a 30-year fixed-rate mortgage at a 3.85 percent interest rate.
  
  
• Forty-three percent of home buyers were able to purchase the $465,000 median-priced condo or townhome. An annual income of $91,200 was required to make a monthly payment of $2,280.

November 8, 2019 - LOS ANGELES – A lower cost of borrowing and higher income levels allowed more Californians to afford a home purchase during the third quarter of 2019, the CALIFORNIA ASSOCIATION OF REALTORS^® (C.A.R.) said on Thursday.

The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in third-quarter 2019 edged up to 31 percent from 30 percent in the second quarter of 2019 and up from 27 percent in the third quarter a year ago, according to C.A.R.’s Traditional Housing Affordability Index (HAI). California’s housing affordability index hit a peak of 56 percent in the third quarter of 2012.

C.A.R.’s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. C.A.R. also reports affordability indices for regions and select counties within the state. The index is considered the most fundamental measure of housing well-being for home buyers in the state.

A minimum annual income of $120,400 was needed to qualify for the purchase of a $613,470 statewide median-priced, existing single-family home in the third quarter of 2019. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,010, assuming a 20 percent down payment and an effective composite interest rate of 3.85 percent, the lowest rate since third-quarter 2016. The effective composite interest rate was 4.17 percent in second-quarter 2019 and 4.77 percent a year ago.

Housing affordability for condominiums and townhomes also improved in the third-quarter 2019 compared to the previous quarter, with 43 percent of California households earning the minimum income to qualify for the purchase of a $465,000 median-priced condominium/townhome, up from 40 percent in the previous quarter. An annual income of $91,200 was required to make monthly payments of $2,280. Thirty-six percent of households could afford to buy a condominium/townhome a year ago.

Compared with California, more than half of the nation’s households (56 percent) could afford to purchase a $280,020 median-priced home, which required a minimum annual income of $54,800 to make monthly payments of $1,370.

Key points from the third-quarter 2019 Housing Affordability report include:

• When compared to a year ago, housing affordability improved in 42 tracked counties and declined in five counties. Affordability remained flat in one county.
• In the San Francisco Bay Area, affordability improved from third-quarter 2018 in every county. San Francisco County was the least affordable, with just 18 percent of households able to purchase the $1,580,000 median-priced home. Forty-seven percent of Solano County households could afford the $460,000 median-priced home, making it the most affordable Bay Area county.
• Affordability also improved in all Southern California regions, with Los Angeles and Orange counties tied for being the least affordable (25 percent) and San Bernardino County being the most affordable (51 percent).
• In the Central Valley region, only Kern County experienced a decline in affordability from a year ago, decreasing from 53 percent in third-quarter 2018 to 51 percent in third-quarter 2019. San Benito County (35 percent) was the least affordable and Kings County (55 percent) was the most affordable.
• Housing affordability improved in three counties in the Central Coast region — Monterey, San Luis Obispo and Santa Cruz — and declined in Santa Barbara.
• During the third quarter of 2019, the most affordable counties in California were Lassen (64 percent), Kings (55 percent) and Madera (52 percent). The minimum annual income needed to qualify for a home in these counties was less than $56,000.
• Mono (17 percent), San Francisco (18 percent), and San Mateo (20 percent) counties were the least affordable areas in the state. San Francisco required the highest minimum qualifying income in the entire state. An annual income of $309,600 was needed to purchase a home in San Francisco County, though down from $343,240 in second-quarter 2019.

See C.A.R.’s historical housing affordability data.
See first-time buyer housing affordability data.

Leading the way…^® in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with more than 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

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CALIFORNIA ASSOCIATION OF REALTORS^®

Traditional Housing Affordability Index
Third quarter 2019

STATE/REGION/COUNTY	3rd Qtr. 2019	2nd Qtr. 2019		3rd Qtr. 2018		Median Home Price	Monthly Payment Including Taxes & Insurance	Minimum Qualifying Income
Calif. Single-family home	31	30		27		$613,470	$3,010	$120,400
Calif. Condo/Townhome	43	40		36		$465,000	$2,280	$91,200
Los Angeles Metro Area	33	32		30		$547,250	$2,680	$107,200
Inland Empire	44	42		41		$380,000	$1,860	$74,400
San Francisco Bay Area	29	24		21		$910,000	$4,460	$178,400
United States	56	55		53		$280,200	$1,370	$54,800
San Francisco Bay Area
Alameda	26	23		18		$920,000	$4,510	$180,400
Contra Costa	39	35		32		$665,000	$3,260	$130,400
Marin	22	21		19		$1,275,000	$6,250	$250,000
Napa	29	28		24		$725,250	$3,550	$142,000
San Francisco	18	17		15		$1,580,000	$7,740	$309,600
San Mateo	20	18		14		$1,510,000	$7,400	$296,000
Santa Clara	22	20		17		$1,240,000	$6,080	$243,200
Solano	47	46		38		$460,000	$2,250	$90,000
Sonoma	28	28		22		$673,250	$3,300	$132,000
Southern California
Los Angeles	25	29		22		$649,570	$3,180	$127,200
Orange	25	24		20		$826,000	$4,050	$162,000
Riverside	41	39		37		$420,000	$2,060	$82,400
San Bernardino	51	50		48		$315,000	$1,540	$61,600
San Diego	29	27		23		$645,000	$3,160	$126,400
Ventura	30	30		28		$667,500	$3,270	$130,800
Central Coast
Monterey	24	24		20		$649,000	$3,180	$127,200
San Luis Obispo	27	25		21		$635,000	$3,110	$124,400
Santa Barbara	22	20		26		$710,000	$3,480	$139,200
Santa Cruz	22	17		12		$855,000	$4,190	$167,600
Central Valley
Fresno	49	48		46		$285,500	$1,400	$56,000
Kern	51	50		53		$260,000	$1,270	$50,800
Kings	55	55		51		$257,000	$1,260	$50,400
Madera	52	51		48		$282,880	$1,390	$55,600
Merced	49	47		40		$279,000	$1,370	$54,800
Placer	48	45		42		$499,000	$2,450	$98,000
Sacramento	45	44		42		$388,000	$1,900	$76,000
San Benito	35	35		27		$589,500	$2,890	$115,600
San Joaquin	44	44		38		$385,000	$1,890	$75,600
Stanislaus	48	48		45		$335,000	$1,640	$65,600
Tulare	51	50		47		$250,000	$1,230	$49,200
Other Calif. Counties
Amador	49	46	r	NA		$320,000	$1,570	$62,800
Butte	38	35		39		$360,000	$1,760	$70,400
Calaveras	49	46		43		$330,000	$1,620	$64,800
El Dorado	42	40		41		$509,600	$2,500	$100,000
Humboldt	37	37		33		$330,250	$1,620	$64,800
Lake	47	44		39		$259,500	$1,270	$50,800
Lassen	64	63		67		$204,000	$1,000	$40,000
Mariposa	44	45		40		$316,500	$1,550	$62,000
Mendocino	30	29		23		$405,000	$1,980	$79,200
Mono	17	15		11		$697,500	$3,420	$136,800
Nevada	41	40		32		$417,500	$2,050	$82,000
Plumas	46	37		44		$316,500	$1,550	$62,000
Shasta	47	47		44		$285,000	$1,400	$56,000
Siskiyou	51	49		47		$225,000	$1,100	$44,000
Sutter	47	46		45		$315,000	$1,540	$61,600
Tehama	46	47		49		$255,500	$1,250	$50,000
Tuolumne	49	48		41		$300,000	$1,470	$58,800
Yolo	39	40		35		$469,000	$2,300	$92,000
Yuba	48	46		48		$299,950	$1,470	$58,800

R = revised
NA = not available
Source: C.A.R.