California News

48% Of Californians Can Afford Entry-Level Home

Orange County Register-

First-home house hunting in California was slightly more affordable late in 2019, according to one industry group.

A California Association of Realtors’ measurement tracking finance conditions for a theoretical first-time homebuyer found 48% of households in the state could affordably purchase one in 2019’s fourth quarter, same as the previous quarter and up from 46% a year ago.

The association measures buying conditions for a hypothetical first-time house hunter with an index that assumes more generous borrowing terms than traditional affordability indexes — including a smaller downpayment (10% vs. 20%); adjustable-loan rates vs. fixed; more household income toward the mortgage payment (40% debt-to-income vs. 30%); and buying a less-expensive starter home (85% of the median price).

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