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  • Twenty-seven percent of California households could afford to purchase the $720,490 median-priced home in the first quarter of 2021, down from 35 percent in first-quarter 2020 and unchanged from fourth-quarter 2020.

  • A minimum annual income of $131,200 was needed to make monthly payments of $3,280, including principal, interest and taxes on a 30-year fixed-rate mortgage at a 3.08 percent interest rate.

  • Forty percent of home buyers were able to purchase the $535,000 median-priced condo or townhome. An annual income of $97,600 was required to make a monthly payment of $2,440.

May 12, 2021 - LOS ANGELES – Housing affordability in California remained at the lowest level since mid-2018 as higher home prices fueled by a shortage of homes for sale pushed the state’s median home price more than 22 percent higher on a year-over-year basis, resulting in an 8 percentage-point annual decline in California’s housing affordability index in the first quarter of 2021, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said on Tuesday.

The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in first-quarter 2021 dropped to 27 percent from 35 percent in the first quarter of 2020 and was unchanged from the fourth quarter of 2020, according to C.A.R.’s Traditional Housing Affordability Index (HAI). The first-quarter 2021 figure is less than half of the affordability index peak of 56 percent in the first 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 $131,200 was needed to qualify for the purchase of a $720,490 statewide median-priced, existing single-family home in the first quarter of 2021. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,280, assuming a 20 percent down payment and an effective composite interest rate of 3.08 percent. The effective composite interest rate was 2.96 percent in fourth-quarter 2020 and 3.70 percent in first-quarter 2020. 

Housing affordability for condominiums and townhomes also declined in first-quarter 2021 compared to a year ago, with 40 percent of California households earning the minimum income to qualify for the purchase of a $535,000 median-priced condominium/townhome, down from 44 percent a year ago and from 41 percent in fourth-quarter 2020. An annual income of $97,600 was required to make monthly payments of $2,440.

Compared with California, more than half of the nation’s households (54 percent) could afford to purchase a $319,200 median-priced home, which required a minimum annual income of $58,000 to make monthly payments of $1,450. Nationwide affordability also fell from 59 percent a year ago.

Key points from the first-quarter 2021 Housing Affordability report include:

  • Housing affordability held even on an annual basis in only two tracked counties (San Francisco and Santa Clara) and declined in 49 counties. Compared to the previous quarter, housing affordability declined in 33 counties, improved in eight counties and was unchanged in 10 counties.
  • In the San Francisco Bay Area, affordability declined from a year ago in every county except San Francisco and Santa Clara counties, which held even. San Mateo County was the least affordable, with just 19 percent of households able to purchase the $1,850,000 median-priced home. Forty-four percent of Solano County households could afford the $525,000 median-priced home, making it the most affordable Bay Area county.
  • Affordability fell from a year ago in all Southern California counties with Orange County being the least affordable (20 percent) and San Bernardino County being the most affordable (45 percent).
  • In the Central Valley region, Kings County was the most affordable at 58 percent, and San Benito was the least affordable at 31 percent.
  • In the Central Coast region, Santa Barbara County was the least affordable at 14 percent and San Luis Obispo County was the most affordable at 25 percent.
  • During the first quarter of 2021, Lassen (62 percent) remained the most affordable county in the state, followed by Kings (58 percent), Siskiyou (49 percent), and Tuolumne (49 percent). The minimum qualifying income was less than $64,000 for each of these counties. Lassen also had the lowest minimum qualifying annual income to purchase a median-priced home at $45,200.
  • Mono (3 percent), Santa Barbara (14 percent), and Monterey (17 percent) were the least affordable counties in the state, with each of them requiring at least a minimum annual income of $157,600 to purchase a median-priced home in the county. San Mateo remained the least affordable county in the state and required the highest minimum qualifying annual income of $337,200 in the first quarter of 2021. It was the only county in California that had a minimum qualifying annual income of over $300,000 in first-quarter 2021.

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.


CALIFORNIA ASSOCIATION OF REALTORS®
Traditional Housing Affordability Index
First quarter 2021

STATE/REGION/COUNTY

Qtr. 1

2021

Qtr. 4

2020

 

Qtr. 1

2020

 

Median Home Price

Monthly Payment Including Taxes & Insurance

Minimum Qualifying Income

Calif. Single-family homes

27

27

 

35

 

$720,490

$3,280

$131,200

Calif. Condo/Townhomes

40

41

 

44

 

$535,000

$2,440

$97,600

Los Angeles Metro Area

29

30

 

35

 

$650,000

$2,960

$118,400

Inland Empire

39

41

 

46

 

$475,000

$2,160

$86,400

San Francisco Bay Area

23

24

 

31

 

$1,157,000

$5,270

$210,800

United States

54

55

 

59

 

$319,200

$1,450

$58,000

                 

San Francisco Bay Area

               

Alameda

22

23

 

28

 

$1,109,000

$5,050

$202,000

Contra Costa

32

34

 

42

 

$835,000

$3,800

$152,000

Marin

22

22

 

23

 

$1,530,000

$6,970

$278,800

Napa

24

29

 

34

 

$901,500

$4,110

$164,400

San Francisco

20

20

 

20

 

$1,745,000

$7,950

$318,000

San Mateo

19

20

 

20

 

$1,850,000

$8,430

$337,200

Santa Clara

22

22

 

22

 

$1,500,000

$6,830

$273,200

Solano

44

45

 

49

 

$525,000

$2,390

$95,600

Sonoma

27

28

 

32

 

$742,500

$3,380

$135,200

Southern California

               

Los Angeles

25

24

 

31

 

$682,360

$3,110

$124,400

Orange

20

22

 

24

 

$1,000,000

$4,560

$182,400

Riverside

36

39

 

44

 

$520,000

$2,370

$94,800

San Bernardino

45

48

 

53

 

$399,000

$1,820

$72,800

San Diego

25

26

 

30

 

$763,500

$3,480

$139,200

Ventura

27

27

 

32

 

$769,000

$3,500

$140,000

Central Coast

               

Monterey

17

18

 

26

 

$865,000

$3,940

$157,600

San Luis Obispo

25

25

 

31

 

$709,750

$3,230

$129,200

Santa Barbara

14

16

 

27

 

$1,060,000

$4,830

$193,200

Santa Cruz

18

19

 

23

 

$1,100,000

$5,010

$200,400

Central Valley

               

Fresno

46

48

 

52

 

$340,000

$1,550

$62,000

Glenn

44

47

 

46

 

$320,000

$1,460

$58,400

Kern

47

48

 

52

 

$300,180

$1,370

$54,800

Kings

58

57

 

61

 

$282,500

$1,290

$51,600

Madera

46

49

 

52

 

$349,000

$1,590

$63,600

Merced

46

45

 

48

 

$315,000

$1,440

$57,600

Placer

39

42

 

46

 

$599,000

$2,730

$109,200

Sacramento

41

43

 

47

 

$465,000

$2,120

$84,800

San Benito

31

31

 

42

 

$718,000

$3,270

$130,800

San Joaquin

42

42

 

46

 

$442,250

$2,020

$80,800

Stanislaus

44

46

 

51

 

$400,000

$1,820

$72,800

Tulare

47

49

 

53

 

$300,000

$1,370

$54,800

Far North

               

Butte

37

35

 

41

 

$400,000

$1,820

$72,800

Lassen

62

67

 

64

 

$249,000

$1,130

$45,200

Plumas

47

45

 

48

 

$337,500

$1,540

$61,600

Shasta

48

49

 

52

 

$335,000

$1,530

$61,200

Siskiyou

49

48

 

52

 

$266,000

$1,210

$48,400

Tehama

46

45

 

49

 

$290,000

$1,320

$52,800

Other Calif. Counties

               

Amador

44

50

 

53

 

$404,570

$1,840

$73,600

Calaveras

41

44

 

48

 

$427,000

$1,950

$78,000

Del Norte

36

36

 

50

 

$349,000

$1,590

$63,600

El Dorado

36

41

 

47

 

$620,000

$2,820

$112,800

Humboldt

39

38

 

43

 

$361,000

$1,640

$65,600

Lake

46

46

 

52

 

$317,000

$1,440

$57,600

Mariposa

37

41

 

46

 

$400,000

$1,820

$72,800

Mendocino

27

28

 

36

 

$520,000

$2,370

$94,800

Mono

3

11

 

17

 

$1,450,000

$6,610

$264,400

Nevada

37

40

 

46

 

$525,000

$2,390

$95,600

Sutter

45

46

 

50

 

$365,500

$1,670

$66,800

Tuolumne

49

50

 

54

 

$350,000

$1,590

$63,600

Yolo

38

38

 

43

 

$515,000

$2,350

$94,000

Yuba

45

49

 

53

 

$370,000

$1,690

$67,600


Source: C.A.R.