https://www.cnbc.com/2025/02/09/us-cities-where-buying-a-home-requires-biggest-share-of-income.htm
Financial Experts recommend that homeowners contribute 30% of their income towards their house. However Nationwide, Americans earning the median income need to spend 41.8% of their salary on housing to afford to own a median-priced home. In five California cities, homebuyers earning the local median income must put at least 67% of their income toward housing to afford a median-priced home.
Los Angeles
- Share of median income needed to buy a median priced home: 77.6%
- Median income: $92,994
- Median home sale price: $896,060
- Share of median income needed to buy a median priced home: 76.2%
- Median income: $159,316
- Median home sale price: $1,513,699
Anaheim
- Share of median income needed to buy a median priced home: 75.9%
- Median income: $121,925
- Median home sale price: $1,165,965
Home costs are high in these cities due to a longstanding housing shortage in California. Zoning laws and high building costs make new construction difficult, while a strong job market and a concentration of wealthy residents has driven demand and prices higher. Los Angeles consistently ranks among the least affordable cities for homebuyers, with a price-to-income ratio of 12.5, while the national median is 4.7. It will be interesting to see how the wildfires will affect the housing market in California as well. It is interesting to think about whether California should change its zoning and allow for more construction or should they just let supply and demand play out and have high housing prices?
78% of income just to put a roof over your head is beyond ridiculous. I wonder if California is actively doing anything to solve this issue.
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