Housing affordability slipped in Los Angeles and Orange counties during the second quarter as higher mortgage rates and rebounding home prices continued to make homeownership out of reach for most households, according to a report released Wednesday by the California Association of Realtors.
In Los Angeles County, just 17% of households could afford to purchase the county’s median-priced single-family home of $879,900 during the second quarter, down from 18% in the first quarter but up from 15% a year earlier, according to the association. A minimum annual income of $219,200 was needed to qualify for the purchase.
Across the Los Angeles metropolitan area, 17% of households could afford the region’s $860,000 median-priced home. Buyers needed a minimum annual income of $214,400.
Orange County remained one of the state’s least affordable housing markets. Just 15% of households could afford the county’s median-priced home of $1.485 million, down from 16% in the previous quarter but up from 14% a year earlier. Prospective buyers needed a minimum annual income of $370,000 to qualify.
“Despite improving from a year earlier, affordability remains near historic lows as elevated housing costs and borrowing expenses continue to limit homeownership opportunities across many California communities,” the report said.
Statewide, housing affordability fell to 19% in the second quarter from a four-year high of 22% in the first quarter. The statewide median home price rose to $916,750, requiring a minimum qualifying income of $228,400, according to the association.