Housing affordability in California remains stuck at just 19%

California’s real estate market remains a brutal nightmare for buyers, with ordinary families needing a staggering $228,000 in annual income just to afford a typical home.

Just 19% of households could afford an existing single-family home at the median price in the Golden State during the third quarter, according to figures released Friday by the California Association of Realtors.

The dismal affordability rate remained unchanged from the previous quarter and the same period last year, offering little relief to Californians hoping to purchase a piece of the American dream.

Even as house prices fell, rising mortgage rates kept the cost of purchasing extremely high, leaving future homeowners facing huge monthly payments.

The minimum qualifying household income needed to purchase a median-priced California home reached $228,000 in the third quarter, unchanged from the previous quarter and $4,400 more than a year earlier.

Buyers were also faced with a monthly mortgage bill of $5,700, including principal, interest, taxes and insurance. This figure remained stable compared to the second quarter, but up 2% year-on-year.

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California’s monthly housing payment remained more than double the national average of $2,760, according to CAR

And the affordability crisis shows no signs of abating. The income required to buy a typical California home has exceeded $200,000 in 15 of the last 16 quarters.

Mortgage rates could remain high over the coming months, with inflation likely to remain high in the short term, further reducing the purchasing power of potential buyers, the association warned.

The numbers were particularly severe in Southern California, where housing prices and the wages needed to keep up varied widely by county.

In the Los Angeles metro area, an existing single-family home had a median price of $847,030 in the third quarter, requiring a monthly mortgage payment of $5,390 and a minimum qualifying household income of $215,600.

The price was even higher in Los Angeles County, where homes cost an average of $958,450. Buyers had to earn at least $244,000 a year to manage monthly payments of $6,100.

Orange County was in a whole different league, with a typical single-family home costing $1.47 million.

Prospective buyers needed a staggering annual household income of $374,400 to qualify, with monthly mortgage payments reaching $9,360.