Higher home prices negated the lowest interest rates in more than a year and reduced Californians' ability to afford a home purchase in the second quarter of 2019, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said Wednesday.

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The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in second-quarter 2019 dipped to 30% from 32% in the first quarter of 2019 but was up from 26% in the second quarter a year ago, according to C.A.R.'s Traditional Housing Affordability Index (HAI). California's housing affordability index hit a peak of 56% in the second quarter of 2012.

A minimum annual income of $122,960 was needed to qualify for the purchase of a $608,660 statewide median-priced, existing single-family home in the second quarter of 2019. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,070, assuming a 20% down payment and an effective composite interest rate of 4.17%. The effective composite interest rate was 4.62% in first-quarter 2019 and 4.70% in second-quarter 2018.

Housing affordability for condominiums and townhomes also slipped in first-quarter 2019 compared to the previous quarter, with 40% of California households earning the minimum income to qualify for the purchase of a $475,000 median-priced condominium/townhome, down from 41% in the previous quarter. An annual income of $95,960 was required to make monthly payments of $2,400. 36% of households could afford to buy a condominium/townhome a year ago.

Key points from the second-quarter 2019 Housing Affordability report include:

  • When compared to a year ago, housing affordability improved in 42 tracked counties and declined in five counties. Affordability remained flat in one county.
  • In the San Francisco Bay Area, affordability improved from second-quarter 2018 in every county. San Francisco County was the least affordable, with just 17% of households able to purchase the $1,700,000 median-priced home. Forty-six% of Solano County households could afford the $445,000 median-priced home, making it the most affordable Bay Area county.
  • Affordability also improved in all Southern California regions, with Orange County being the least affordable (24%) and San Bernardino County being the most affordable (50%).
  • In the Central Valley region, only Kern County experienced a decline in affordability from a year ago, decreasing from 53% in second-quarter 2018 to 50% in second-quarter 2019. San Benito County (35%) was the least affordable and Kings County (55%) was the most affordable.
  • Housing affordability improved in three counties in the Central Coast region — Monterey, San Luis Obispo and Santa Cruz — and was unchanged in one, Santa Barbara.
  • During the second quarter of 2019, the most affordable counties in California were Lassen (63%), Kings (55%) and Madera (51%). The minimum annual income needed to qualify for a home in these counties was less than $60,000.
  • Mono (15%), San Francisco (17%), Santa Cruz (17%) and San Mateo (18%) counties were the least affordable areas in the state. San Francisco and San Mateo counties required the highest minimum qualifying incomes in the state. An annual income of $343,420 was needed to purchase a home in San Francisco County, and an annual income of $338,870 was required in San Mateo County.
CALIFORNIA ASSOCIATION OF REALTORS® Traditional Housing Affordability Index Second quarter 2019

STATE/REGION/COUNTY 2nd Qtr. 2019 1st Qtr. 2019
2nd Qtr. 2018
Median Home Price Monthly Payment Including Taxes & Insurance Minimum Qualifying Income
Calif. Single-family home 30 32
26
$608,660 $3,070 $122,960
Calif. Condo/Townhome 40 41
36
$475,000 $2,400 $95,960
Los Angeles Metro Area 32 33
29
$540,000 $2,730 $109,090
Inland Empire 42 42
41
$380,000 $1,920 $76,760
San Francisco Bay Area 24 26
18
$980,000 $4,950 $197,970
United States 55 57
53
$279,600 $1,410 $56,480









San Francisco Bay Area







Alameda 23 25
16
$950,000 $4,800 $191,910
Contra Costa 35 37
29
$690,000 $3,480 $139,390
Marin 21 21
18
$1,381,250 $6,980 $279,030
Napa 28 29
25
$710,000 $3,590 $143,430
San Francisco 17 17
14
$1,700,000 $8,580 $343,420
San Mateo 18 18
14
$1,677,500 $8,470 $338,870
Santa Clara 20 20
16
$1,330,000 $6,720 $268,680
Solano 46 46
38
$445,000 $2,250 $89,900
Sonoma 28 27
20
$660,000 $3,330 $133,330
Southern California







Los Angeles 29 28
26
$567,010 $2,860 $114,540
Orange 24 24
20
$835,000 $4,220 $168,680
Riverside 39 39
37
$420,000 $2,120 $84,840
San Bernardino 50 50
49
$310,000 $1,570 $62,620
San Diego 27 27
23
$655,000 $3,310 $132,320
Ventura 30 29
28
$650,000 $3,280 $131,300
Central Coast







Monterey 24 25
19
$630,000 $3,180 $127,270
San Luis Obispo 25 26
22
$640,000 $3,230 $129,290
Santa Barbara 20 25
20
$724,500 $3,660 $146,360
Santa Cruz 17 17
12
$937,500 $4,740 $189,390
Central Valley







Fresno 48 48
46
$279,920 $1,410 $56,550
Kern 50 50
53
$255,000 $1,290 $51,510
Kings 55 57
50
$250,000 $1,260 $50,500
Madera 51 52
48
$277,000 $1,400 $55,960
Merced 47 46
42
$282,000 $1,420 $56,970
Placer 45 46
41
$514,950 $2,600 $104,030
Sacramento 44 44
41
$385,000 $1,940 $77,770
San Benito 35 31
30
$571,500 $2,880 $115,330
San Joaquin 44 43
38
$380,000 $1,920 $76,760
Stanislaus 48 47
45
$325,250 $1,640 $65,700
Tulare 50 51
48
$247,500 $1,250 $50,000
Other Calif. Counties






Amador NA NA
44
NA NA NA
Butte 35 34
38
$370,000 $1,870 $74,740
Calaveras 46 47
43
$343,000 $1,730 $69,290
El Dorado 40 40
38
$519,500 $2,620 $104,940
Humboldt 37 36
33
$320,000 $1,610 $64,570
Lake 44 44
37
$267,000 $1,350 $53,820
Lassen 63 63
64
$204,000 $1,030 $41,080
Mariposa 45 41
39
$300,000 $1,510 $60,350
Mendocino 29 28
22
$400,000 $2,010 $80,380
Mono 15 10
14
$699,500 $3,510 $140,410
Nevada 40 40
32
$419,000 $2,100 $84,020
Plumas 37 48
42
$367,390 $1,840 $73,600
Shasta 47 44
46
$281,000 $1,410 $56,230
Siskiyou 49 53
48
$232,500 $1,160 $46,480
Sutter 46 46
45
$312,500 $1,560 $62,400
Tehama 47 43
51
$244,000 $1,220 $48,680
Tuolumne 48 45
43
$300,000 $1,490 $59,790
Yolo 40 39
33
$455,000 $2,260 $90,590
Yuba 46 46
45
$305,000 $1,520 $60,660

NA = not available