Dive Brief:
-
Housing affordability has improved slightly in California, HousingWire reported, with a median-priced existing single-family home affordable to 32% of buyers in Q1 2017, up one percentage point from the prior quarter and marking the 16th-straight quarter the figure has been under 40%.
-
Buyers in California need a minimum income of just over $100,000 to qualify for a median-priced ($496,620) single-family home. This compares to $47,690 nationwide for the median-priced home of $232,100.
-
Affordability is most out of reach in the San Francisco Bay Area, with an average $160,350 income requirement (but a whopping $267,130 in San Francisco and San Mateo). The Inland Empire offers the most affordability, with $67,080 qualifying income.
Dive Insight:
California accounted for half of the 20 most-active markets in April, and its popularity has contributed to continued tight inventory and climbing prices.
The affordability challenges have been so great that some Californians have taken on lengthy commutes to find housing – rented or owned – that they can afford. Companies are expressing concern about how the housing challenges will impact their ability to find qualified workers.
The supply and price woes have led State Sen. Scott Wiener to ask other legislators and activists to focus more positive attention on market-rate housing in addition to low-income projects as a way to balance competing interests and ensure projects get built. Earlier this month, San Francisco Mayor Ed Lee put forth a $44 million proposal to create low-cost teacher housing in the city – where many educators couldn’t otherwise afford to live.
The state’s inventory shortage is a major driver behind the current slowdown in home-sales activity there, the California Association of Realtors reported. Existing single-family home sales fell 2.4% from March to April, with year-over-year declines in the San Francisco Bay Area (down 4.3%), Los Angeles (down 6.4%) and the Inland Empire (down 3.1%). At the same time, median home prices in the state reached a near-10-year high.
