Rising Prices, Mortgage Rates Blamed : 15% Can Afford to Buy a Home

Fewer than one in six county families could afford a median-priced house in the county during February.

The California Assn. of Realtors on Tuesday blamed rising home prices and higher mortgage interest rates for a drop in the number of people who can afford such single-family, resale houses in all the state’s major urban areas.

In Orange County, where the median price of such a house was $237,409 in February--among the highest in the state--just 15% of families in the county could afford one. That was down from 16% in January and 29% a year ago, when the median price was $179,757. The figures do not include condominiums or new houses.

Statewide, the situation was not much better. Just 19% of families could afford the median price for such a house, $190,252. In January, 21% could afford such a home.

But Orange County did not have the worst problem: In both San Francisco and Ventura counties in February, just 12% of families could afford such a house, based on their median income. Home prices were a little higher than Orange County in both places.

In calculating the figures, the trade group assumed that a family could make a 20% down payment and put 30% of its income toward monthly housing payments, based on an average of adjustable-rate and fixed mortgage rates.

The average rose from 9.61% in early January to 9.77% in early February.

Based on those calculations, an Orange County family needed an annual income of $76,303 to afford monthly loan payments of $1,908 in February.

AFFORDABILITY INDEX FOR EXISTING HOMES

In Orange County, 15% of households could afford to buy the median-priced resale home in the county in February, compared to 16% in January and 29% in January, 1988.

Median Monthly Selling Price Mortgage Payment Feb. Jan. Feb. Feb. Jan. Feb. 1989 1989 1988 1989 1989 1988 Orange County $237,409 236,890 179,757 $1,908 1,881 1,380 United States 93,100 89,700 88,100 748 712 677 California 190,252 184,711 149,847 1,529 1,467 1,151 S.F. Bay Area 241,695 238,285 179,288 1,942 1,892 1,377 Los Angeles 198,655 195,460 155,607 1,596 1,552 1,195 San Diego 159,314 162,577 133,432 1,280 1,291 1,025 Riverside/ na 111,944 94,840 na 889 728 San Bernardino Ventura 244,010 235,827 175,592 1,961 1,873 1,348

Minimum Percent Annual Income Qualified Feb. Jan. Feb. Feb. Jan. Feb. 1989 1989 1988 1989 1989 1988 Orange County $76,303 75,247 55,216 15 16 29 United States 29,922 28,493 27,062 46 48 46 California 61,147 58,673 46,029 19 21 27 S.F. Bay Area 77,681 75,690 55,072 12 13 25 Los Angeles 63,848 62,087 47,798 18 19 25 San Diego 51,203 51,642 40,987 22 22 28 Riverside/ na 35,558 29,132 na 37 42 San Bernardino Ventura 78,245 74,909 53,937 12 12 25

Source: California Assn. of Realtors