Monday, February 13, 2006

Home Affordability in 2005

Affordability Still At A Record Low

Housing affordability remain at 14% in December matching its record low label as rising prices and interest rates continued to slow the market.

In December the median price for a home in the state soared 15.6% to $ 548,430.00 and sales plunged 17.6%

In Los Angeles County, where the median price home cost $ 552.760, affordability fell an annual 5 percentage points to 12%

The minimum household income needed to purchase a median price home in California in December was $134,200 based on an average mortgage interest rate of 6.33% and assuming a 20% downpayment.

This is the beginning of a slowdown in the market that's been anticipated. Prices are still going to go up, but below the 10% range, and the volume of sales will slow significantly.

Alberto Pacheco
818 481 9211
Keller Williams Porter Ranch

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