Housing affordability in Santa Clara County has reached a 10-year-low, but perhaps even more concerning is that those same lows are now impacting regions that are typically more affordable, like Alameda, Sacramento, Merced and Sonoma, according to the California Association of Realtors (CAR) First-time Buyer Housing Affordability Index .
In the second quarter of 2018, just 26-percent of California households could afford the $596,730 median-priced home in their state, marking the 21st consecutive quarter that the index has been below 40-percent, CAR reports.
CAR’s Traditional Housing Affordability Index (HAI) measures the percentage of households that can afford to purchase the median priced home, factoring in likely household incomes in regions.
Santa Clara County, where median home price was over $1.4 million in the second quarter, was among the five least affordable counties. Just 16 percent of households could afford the median price, according to CAR.
Santa Cruz turns out to be the least affordable in California at 12-percent, followed by San Francisco, San Mateo and Mono (all at 14 percent). Alameda is tied with Santa Clara.
The most affordable counties in California were, in this order, Lassen, Kern, Madera, Tehama and Kings.
CAR says increasing home prices coupled with higher interest rates has impacted affordability.