More People Can Afford O.C. Homes

More people can afford a house in Orange County this year because home prices have dropped slightly.

Of the county’s households, 21% could afford the median home price--$238,600--in March.

A family needed an income of $75,200 to afford the needed monthly payments of $1,610, the California Assn. of Realtors said Monday. Monthly payments in the association’s survey assume a 20% down payment.

Last March, when the median price was $246,600, only 14% of households could afford to buy.

The trade association does its survey every three month on the number of families that can afford to buy a home. The survey excludes condominiums and new homes.

In December, 21% of families could afford the median price of $229,120. Orange County home prices rose rapidly in 1988 and 1989, squeezing even more families out of the market.

(The trade association assumes family income in the county has risen too in recent months.)

So few people have been able to afford homes in the last few years that sales dried up. Then the recession and the Gulf War also hurt sales, and prices began to drop.

But home prices in Orange County--and, indeed, in all of California’s coastal urban areas--are still among the highest in the nation. So affordability remains a big problem.

For the state, only 21% of families could afford the median home price of $202,470 in March. A family needed an income of $63,790 to meet the corresponding monthly payments of $1,360.

For the nation, by contrast, more than half of families--51%--could afford the median house price of $96,500 in March. A family needed an income of $30,410 to meet the monthly payments of $650.