Median home price out of reach for most

Twenty percent of California households could afford a median-priced home of $760,260 during the first quarter of this year, according to a report released May 16.

That was a three percent increase from the fourth quarter of 2022, but a 24 percent decline compared with the first quarter of 2022, the  California Association of Realtors reported in its Traditional Housing Affordability Index.

Higher interest rates were blamed for the year-over-year drop in affordability, a factor that is not expected to go away soon

A minimum annual income of $188,400 was needed to purchase a median-priced home, with monthly payments of $4,710. Those numbers assume a 20 percent down payment and a 30-year fixed-rate mortgage with a 6.4 percent interest rate.

Twenty-six percent of the state’s households could afford a median-priced condominium/townhome – $619,000 – unchanged from the first quarter of 2022.

Twenty-four percent of Inland Empire households could afford the median-priced $550,000 single-family home in that market during the first quarter, That was essentially unchanged from one year earlier, the Los Angeles-based association reported.