A Look at the Current California Housing Market
California Housing Market – The California Association of Realtors reports that the First-time Buyer Housing Affordability Index stood at 64 percent in the third quarter of 2009 compared with 55 percent (revised) in the third quarter of 2008.
This means that 64% of the households in the state can afford to buy an entry level home in California, compared to only 55% a year ago.
They also report the median price of an entry-level home in the California Housing Market was $247,150 in the third quarter of 2009 and estimated the monthly payment including taxes and insurance was $1,450 in the third quarter of 2009.
Locally, Contra Costa Affordability declined by one percentage point to 42% from last quarter, but shows 9% more households able to afford an entry level home than a year ago.
Alameda County showed a 10% year-over-year increase in the number of families able to purchase, but this figure is 3% lower than last quarter.
A 10.2% statewide increase in entry-level home prices is cited as the reason for the quarter to quarter declines in affordability.
Santa Cruz County has similar numbers to Contra Costa at 43% affordability, but dropped a full 3% from last quarter. One year ago, the First-time Buyer Affordability Index was only 36%.
These are important numbers! In fact, they are regarded as the most fundamental metric of the health of residential Real Estate.
The California Housing Market moves in cycles, and we expect the entry-level market to show the way by priming the sales of upper level homes. Already, we have seen a 10+% gain in home prices – healthy appreciation in any market!
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