Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Sacramento Region Housing Prices And Median income In Sync

With the recent upshot of home prices, it may not seem that median home prices and family incomes have aligned but that would be the case in various parts of California. Maybe not here in San Francisco but up in the state capital region families can actually afford housing.

According to local economic studies by California State University, Sacramento area home prices and incomes show that affordability hit its highest level in more than two decades.

Looking back on the peak of the housing boom at the end of 2005, only about 7 percent of families in the Sacramento region with a median income could afford to buy a home according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.

As we look at the second quarter this year, the same family could buy nearly 79 percent of houses sold in the capital area.

Specific Communities Offer Various Affordability Index Marks

Taking a closer look at some specific communities, we see that an El Dorado Hills family earning the median income of about $120,000, could afford to purchase a $465,000 home.

Over in Davis, the estimates show that a family earning the median of $101,000 could handle a $375,000 loan. But consider that the July median home price for Davis hit $452,000. Over in Roseville, families can purchase lower bargains where a family earning the median income of $88,000 could afford a $360,000 mortgage, which rests above the July median home price of $290,000.

In Sacramento proper, the index remains slightly out of whack, as a family earning a  median income of about $55,000 could (with current low interest rates) afford a $235,000 mortgage, yet the median home price in July still sits around $138,000. One reason for the Sacramento index affordability continues to the numerous short sales and foreclosures in the capital.

Chart courtesy National Association of Home Builders and Sacramento Bee

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

Housing Prices and Buyers Income Aligned In Many Parts Of California

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1 Comment

Filed under California, Foreclosure, Mortgages, short sales

One response to “Housing Prices and Buyers Income Aligned In Many Parts Of California

  1. Pingback: Home Prices May Not Return To Peak Until 2023 | Resource Blog

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