Higher home prices offset lower interest rates to reduce housing affordability in California during the fourth quarter of 2012, the California Association of Realtors reported today.
(Flickr: Vicki Moore)
The percentage of home buyers who could afford to purchase a median-priced existing single-family home in California decreased to 48 percent in the fourth quarter of 2012, down from 49 percent in the third-quarter 2012 and from 55 percent in the fourth-quarter 2011, according to CAR’s Traditional Housing Affordability Index.
The index measures the percentage of all households that can afford to purchase a median-priced single-family home in California.
The Index is considered the most fundamental measure of housing well-being for home buyers in the state.
Home buyers needed to earn a minimum annual income of $66,940 to qualify for the purchase of a $353,190 statewide median-priced single-family home in the fourth quarter of 2012, CAR said in a statement released at its Los Angeles headquarters.
The monthly payment, including taxes and insurance on a 30-year fixed-rate loan, would be $1,670, assuming a 20 percent down payment and an effective composite interest rate of 3.49 percent, according to CAR.
The effective composite interest rate in the third-quarter of 2012 was 3.72 percent and 4.30 percent in the fourth quarter of 2011.
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