Home prices in California soared despite low mortgage interest rates, further reducing the affordability rate in the state during the second quarter.
The percentage of homebuyers who could afford a median-priced, existing single-family home in California in Q2 2019 fell to 30% from 32% in Q1 2019, according to the California Association of Realtors' Traditional Housing Affordability Index (HAI).
CAR's index reported that prospective buyers need a minimum annual income of $122,960 in order to qualify for a $608,660 median-priced, existing single-family home in the second quarter.
A 30-year fixed-rate loan, which includes taxes and insurance, would cost Californians monthly payments of $3,070 (assuming a 20% down payment and an effective composite interest rate of 4.17%).
Condominiums and townhomes also became less affordable in the last quarter, with the share of homebuyers who could afford the median price dropping from 41% to 40%. Households need an annual income of $95,960 to qualify for a $475,000 median-priced condominium/townhome, with monthly payments of $2,400.
Overall, 55% of households in the US could afford to buy a home at the national median price of $279,600. Homebuyers would need a minimum annual income of $56,480 to make monthly payments of $1,410 on a home priced at the national median.