California Median Home Price Now Tops $120,000
The median-priced California home has just topped the $120,000 mark for the first time, while San Francisco and New York City maintain their dubious claims to having the nation’s most expensive new homes and the highest rentals, respectively.
Continuing stability in the home-loan interest market has improved levels of housing affordability for Californians, increasing the number of households able to buy homes despite gradually rising house prices.
Today, 37% of the state’s families have an income of $37,720 and can afford to buy the median-priced home, newly pegged at $120,649. The price tag at the end of 1984 was $112,472 and required minimum income of $38,400.
Joel Singer, vice president of planning, research and economics for the California Assn. of Realtors, adds that a contributing and major factor has been increases of between 5% and 10% in household incomes annually since 1978.
And it follows that as long as interest rates hover around the 12% mark for most loans, the levels of affordability will improve.
Elsewhere in the nation, the affordability index--comparatively speaking--reflects bargain-rate prices and dramatic and enviable differences. For instance, at midyear, the median home price throughout the United States was $77,900. The minimum income needed to buy that house was $24,640, according to Singer’s statistics, and 49% of the nation’s families had at least that much income.
You have to go back more than 10 years to find parity between Southland and U.S. home prices. In 1974, prices for the typical home hereabouts and nationally were both pegged at about $41,000. But the gap started to widen a year later, and by 1976, tidy little Southern California houses--minding their own businesses--suddenly doubled in value.
Specifically, in one painful experience, a Silver Lake dwelling with a great view sold for $55,000 in 1975--for a seemingly nice profit of $10,000--and was resold a year later for $120,000. That’s when the phrase “pent-up demand” came into fashion.
As for San Francisco and New York, they have the highest prices for new homes and apartments. The price for a 2,000-square-foot, three-bedroom, two-bath dwelling is $325,000 in the Bay City while the average gross monthly rent paid in the Big Apple is $1,050, tops among North American cities. (The most expensive apartment was $7,600 for a furnished, four-room unit, according to the Union Bank’s sixth annual comparative survey of living costs in 49 major international cities.)
