Most Residents of Orange and Los Angeles Counties Cannot Afford to Buy a House

A new city report shows that residents of Los Angeles County must earn $100,000 a year to afford a house. The figure shows the affordability index in LA and Orange counties is trending far lower than San Bernadino County.

According to figures released by the California Association of Realtors, only 29 percent of households in LA County can afford to buy a home at the current median price. The report shows in the first quarter of 2017, the median home price in LA County stood at $485,500. The price is up by 28 percent compared to the same quarter in 2016.

The figures also show that residents of the county must earn a minimum of $99,830 annually to afford a monthly mortgage payment of $2,500 on a 30-year, fixed-rate mortgage, which includes taxes and interest. The figures assume a 4.36 percent rate on a mortgage.

The report by the CAR shows the housing affordability situation in Orange County is much worse. The median home price in the first quarter of 2017 is $750,000. According to the CAR, only 21 percent of households in the county can afford to buy a home at the current median price. A household in Orange County would need to earn $154,120 to afford a monthly mortgage payment of $3,850.

The figures in San Bernardino are far better. According to the figures, 52 percent of households in the county can afford the current median home price of $256,900. The household income needed to afford a monthly mortgage payment of $1,320 is $52,790, which is half of the annual income needed to afford a home in LA County. San Bernardino County ranks as one of the most affordable counties in California. King, Sutter and Kern counties also ranked at the top of the most affordable counties in the state.


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