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California housing affordability improves in fourth-quarter 2021 as prices level off and incomes grow, C.A.R. reports


· Twenty-five percent of California households could afford to purchase the $797,470 median-priced home in the fourth quarter of 2021, up from 24 percent in third-quarter 2021 but down from 27 percent in fourth-quarter 2020.

· A minimum annual income of $148,000 was needed to make monthly payments of $3,700, including principal, interest and taxes on a 30-year fixed-rate mortgage at a 3.28 percent interest rate.

· Thirty-six percent of home buyers were able to purchase the $610,350 median-priced condo or townhome. A minimum annual income of $113,200 was required to make a monthly payment of $2,830.

LOS ANGELES (Feb. 10) – A tempering of home price growth combined with a solid increase in household incomes improved the affordability outlook for Californians in the fourth quarter of 2021, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.

The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in fourth-quarter 2021 inched up to 25 percent from 24 percent in the third quarter of 2021 but was down from 27 percent in the fourth quarter of 2020, according to C.A.R.’s Traditional Housing Affordability Index (HAI). The fourth-quarter 2021 figure is less than half of the affordability index peak of 56 percent in the first quarter of 2012.

C.A.R.’s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. C.A.R. also reports affordability indices for regions and select counties within the state. The index is considered the most fundamental measure of housing well-being for home buyers in the state.

A minimum annual income of $148,000 was needed to qualify for the purchase of a $797,470 statewide median-priced, existing single-family home in the fourth quarter of 2021. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,700, assuming a 20 percent down payment and an effective composite interest rate of 3.28 percent. The effective composite interest rate was 3.07 percent in third-quarter 2021 and 2.96 percent in fourth-quarter 2020.

With the median price of condominiums and townhomes reaching another record high in fourth-quarter 2021, affordability for condos and townhomes dipped from the previous quarter. Thirty-six percent of California households earned the minimum income to qualify for thepurchase of a $610,350 median-priced condo/townhome in the fourth quarter of 2021, which required an annual income of $113,200 to make monthly payments of $2,830. The fourth quarter 2021 figure was down from 41 percent a year ago.

Compared with California, half of the nation’s households could afford to purchase a $361,700 median-priced home, which required a minimum annual income of $67,200 to make monthly payments of $1,680. Nationwide affordability was down from 55 percent a year ago.

Key points from the fourth-quarter 2021 Housing Affordability report include:

  • Compared to the previous quarter, housing affordability in the fourth quarter of 2021 declined in 19 counties, improved in 19 counties and remained unchanged in 13 counties. Compared to the previous year, forty-one counties experienced a drop in housing affordability from a year ago, 6 counties increased year-over-year, and four counties remained flat from last year.

  • In the nine-county San Francisco Bay Area, affordability improved from the previous quarter in Alameda, Contra Costa, Marin and Napa and was unchanged in the remaining five counties. San Mateo County was the least affordable Bay Area county, at just 19 percent of households able to purchase the $2,100,000 median-priced home. Forty-two percent of Solano County households could afford the $585,000 median-priced home, making it the most affordable Bay Area county.

  • In the Southern California region, Los Angeles was the only county whose affordability improved from the previous quarter. Orange, Riverside, San Bernardino and Ventura counties recorded a decline in affordability from the previous quarter and San Diego was unchanged. At 17 percent, Orange County was the least affordable, and San Bernardino was the most affordable at 42 percent

  • In the Central Valley region, Kings County was the most affordable at 54 percent, and San Benito was the least affordable at 27 percent.

  • In the Central Coast region, Santa Cruz County was the least affordable, and San Luis Obispo County was the most affordable at 22 percent.

  • For the state as a whole, Lassen (63 percent) was the most affordable county in in the fourth quarter of 2021, followed by Kings (54 percent), Merced (45 percent), Shasta (45 percent) and Tuolumne (45 percent). Lassen also required the lowest minimum qualifying income to purchase a median-priced home at $46,000.

  • Mono (13 percent), Orange (17 percent) and Santa Cruz (17 percent) were the least affordable counties in the state, with each requiring at least a minimum income of $158,000 to purchase a median-priced home in the county. San Mateo required the highest minimum qualifying income to buy a median-priced home in fourth-quarter 2021 at $390,000. The other two California counties with a minimum qualifying income exceeding $300,000 were San Francisco ($338,800) and Santa Clara ($311,200).

  • Housing affordability declined the most on a year-over-year basis in Yuba and Mariposa, dropping 13 and 11 points, respectively from the fourth quarter of 2020. The drop in affordability in Yuba was due partly to a surge in the county’s median price from a year ago but also was due to the decline in its median household income. For Mariposa, the decline in affordability was caused by a 25.3 percent year-over-year increase in its median home price.



Leading the way…® in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with more than 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.






C.A.R.’s Housing Affordability Fund partners with housing nonprofits to provide closing cost grants to underserved first-time buyers


LOS ANGELES (Jan. 12) – In an effort to address California’s growing housing affordability crisis and racial homeownership divide, the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) Housing Affordability Fund is partnering with three regional nonprofit housing organizations to provide closing cost grants up to $10,000 for eligible first-time homebuyers from an underserved community, C.A.R. announced today.


The Inland Empire’s Neighborhood Partnership Housing Services (NPHS), Neighborhood Housing Services LA County, and the Bay Area’s Richmond Neighborhood Housing Services are partnering with C.A.R.’s Housing Affordability Fund (HAF) to administer funds of up to $250,000 within each of their regions in 2022 under C.A.R.’s Closing Cost Assistance grant program.


“Homeownership is a key element to building generational wealth and economic security for working families while stabilizing communities across our state,” said C.A.R. President Otto Catrina. “We’re pleased to partner with these nonprofit organizations to help create true housing equity for all Californians, so they have an opportunity to realize the economic and societal benefits that homeownership provides.”


C.A.R. released a report last year showing that less than half of Black households earned the minimum income needed to purchase a home as compared to whites, illustrating the homeownership gap and wealth disparity for people of color, women, people with disabilities, indigenous people and members of the LGBTQ community. Also, according to most recent data, homeownership rates for Black (37%) and Latino (44%) households were far below overall rates (55%).

Program Criteria:

  • Recipient must be a first-time homebuyer.

  • Recipient must be a member of an underserved community, including LGBTQ+ and veterans.

  • The property being purchased by recipient must be a single-family residence.

  • The purchased property must not have an affordable housing deed restriction.

  • Recipient’s income must be no more than 120% of the Area Median Income (“AMI”).

  • Recipient must be represented by a REALTOR® in the transaction.

  • Recipient must certify they intend occupy within 60 days of escrow close for a minimum of 3 years.

  • Recipient must use either government or conventional GSE financing.

  • Recipient must be left with no more than $20,000 in savings after the purchase.

C.A.R. established its Housing Affordability Fund (HAF) in November 2002 as a non-profit 501(c)(3) to address California’s growing housing affordability crisis.


The nonprofit partners selected have experience creating and administering home buyer assistance programs and have long-standing presence within underserved communities. The partners also offer HUD-approved first-time home buyer counseling and can help program recipients increase their buying power by layering C.A.R.’s Housing Affordability Fund Closing Cost Grant Program with other forms of buyer assistance that their organizations may be offering or administering.


Leading the way…® in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS®(www.car.org) is one of the largest state trade organizations in the United States with more than 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

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