Lower prices and interest rates in the third quarter of 2011 contributed to an improvement in housing affordability for California home buyers.
The percentage of home buyers who could afford to purchase a median-priced home in California rose to 52 percent in the third quarter of 2011, up from 51 percent in second-quarter 2011 and was up from 46 percent in the third quarter of 2010, according to C.A.R.’s Traditional Housing Affordability Index (HAI).
San Diego real estate affordability went from 14% in 2005 to 41% in the 2nd quarter of this year to 42% in the 3rd quarter of 2011.
Home buyers needed to make at least $61,530 per year to be able to purchase a $292,120 home in the third quarter of 2011. The monthly payment, including taxes and insurance, would be $1,540, assuming a 20 percent down payment and an interest rate of 4.63 percent.
Most 2 bed 2 bath properties cost that much to rent nowadays in San Diego, many times even more!
Issues? Well, first time homebuyers usually account for a large amount of home sales when the chips are down. This time around first time homebuyers have made up just a third of the market this year, showing the hurdles many home buyers are experiencing in qualifying for a home loan.
Very sad and frustrating for many.