The annual earnings required to buy a typical California home has almost doubled over the previous 5 years.
To see how homebuying burdens have multiplied, my trusty spreadsheet in contrast the California Affiliation of Realtors’ homebuying affordability report for the primary quarter of 2025 with the ultimate three months of 2019, simply earlier than the pandemic disrupted the economic system.
These numbers inform us that to begin 2025, a $218,000 earnings was essential to income-qualify a profitable California purchaser, an ordinary that has grown 82% because the finish of 2019. Keep in mind, the Realtor yardstick assumes consumers spend 30% of their earnings primarily based on a mortgage with a 20% down fee, with a further 1.4% of the acquisition worth going towards property taxes and insurance coverage.
A part of the home hunter’s problem is that mortgage charges have been 6.93% in early 2025, in comparison with 3.89% in late 2019. However don’t forget pricing. California’s median promoting worth elevated by 40% over 5 years to $846,830.
This interprets to solely 17% of California households having the means to purchase this 12 months, in comparison with 31% at year-end 2019.
Now, for those who’re a cut price hunter condos or townhomes, the monetary stress is barely modestly lowered. In early 2025, consumers wanted an annual earnings of $172,400. That’s up 83% in 5 years, which will get you the $670,000 median-priced residence that has appreciated 40% since 2019.
Condominium/townhome affordability is barely higher, but it surely stays low: 24% now, in comparison with 41% 5 years in the past.
Geographically talking, there’s a break up, too.
Southern California is “cheaper” – the $213,600 required earnings has elevated by 97% in 5 years. These paychecks qualify somebody for the $830,000 median residence, which is 51% pricier than in 2019. Affordability? 15% now, in comparison with 33% 5 years in the past.
However within the Bay Space, you want $334,400 to purchase – up 84% in 5 years. That will get you the $1.3 million median residence, up 41% since 2019. Affordability? 21% vs. 28% 5 years in the past.
The standard American home hunter wants far much less cash to purchase, however their burden is ballooning, too.
The $103,600 wanted for a U.S. home buy has elevated by 92% in 5 years. It buys the $402,300 median residence, which is 46% pricier since 2019. Affordability? 37% vs. 57% 5 years in the past.
Regionally talking
On the county stage, listed below are the ten largest jumps in incomes wanted to purchase a single-family home since 2019 …
Mono: $325,200 required in 2025’s first quarter, up 190% in 5 years. That buys the $1.26 million median-priced home, which has seen a worth enhance of 122% since 2019. Affordability? 5% to begin 2025, in comparison with 26% 5 years in the past.
Santa Barbara: $388,000 required, up 184% in 5 years, for the $1.51 million home that’s 117% costlier since 2019. Affordability? 9% vs. 23%.
Orange: $373,200 required, up 129% in 5 years, for a $1.45 million home that’s 75% costlier since 2019. Affordability? 12% vs. 26%.
Santa Clara: $520,000 required, up 112% in 5 years, for a $2 million home that’s 62% costlier since 2019. Affordability? 18% vs. 22%.
San Diego: $266,800 required, up 107% in 5 years, for a $1 million home that’s 58% costlier since 2019. Affordability? 12% vs. 29%.
San Bernardino: $128,800 required, up 106% in 5 years, for a $500,000 home that’s 57% costlier since 2019. Affordability? 28% vs. 51%.
San Luis Obispo: $246,000 required, up 103% in 5 years, for a $955,480 home that’s 55% costlier since 2019. Affordability? 11% vs. 29%.
Kern: $102,800 required, up 101% in 5 years, for a $400,000 home that’s 54% costlier since 2019. Affordability? 30% vs. 50%.
Riverside: $164,800 required, up 99% in 5 years, for a $640,000 home that’s 52% costlier since 2019. Affordability? 20% vs. 41%.
Tulare: $97,600 is required, up 98% in 5 years, for a $380,000 home that’s 52% costlier since 2019. Affordability? 30% vs. 52%.
