You can't afford to buy

It is reported today that fewer households are able to afford homes in
California.




Using a benchmark set in 1989, housing affordability sunk to 12%.
Affordability was at an all time low since 1989, the last major housing
boom.




A quoted source for the Long
Beach Press-Telegram said, "affordability is hitting a record low
during a year when we expect to post a record high for homesales and a
record high for home price".




Statewide, the median home price according to the California
Association of Realtors is $568,890 which using stardard qualifying
criteria, would require an income of $133,800 based on a 30 year loan
at 5.87% and a 20% down payment, approximately $113,760.




According to the Los Angeles Times
in another report today, Angelo Mozilo,
CEO of Countrywide Financial Group was interviewed for Bloomberg news and said, " I
don't see a substantial discount". Referring to single family home
prices. Angelo continued with, "You could see substantial reduction in
values in the condo market in areas of high speculation such as Broward
and Dade counties in Florida and Las Vegas, you could have 20%
reduction.

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John W.
TeamResults@century21.com