C.A.R.: Affordability Improves in Bay Area; Dips Statewide

Published Thursday, August 13, 2020

Higher home prices and economic recession dampen California housing affordability in second quarter 2020, C.A.R. reports. Housing affordability improves in Bay Area

  • Thirty-three percent of California households could afford to purchase the $610,850 median-priced home in the second quarter of 2020, down from 35 percent in first-quarter 2020 but up from 30 percent a year ago.
  • A minimum annual income of $115,200 was needed to make monthly payments of $2,880, including principal, interest and taxes on a 30-year fixed-rate mortgage at a 3.43 percent interest rate.
  • Forty-four percent of home buyers were able to purchase the $480,000 median-priced condo or townhome. An annual income of $90,400 was required to make a monthly payment of $2,260.

LOS ANGELES (Aug. 12) – Higher home prices and lower household income caused by the economic recession dampened California housing affordability in the second quarter of 2020, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.

The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in second-quarter 2020 dipped to 33 percent from 35 percent in the first quarter of 2020 but was up from 30 percent in the second quarter a year ago, according to C.A.R.’s Traditional Housing Affordability Index (HAI). California’s housing affordability index hit a peak of 56 percent in the second quarter of 2012.

C.A.R.’s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. C.A.R. also reports affordability indices for regions and select counties within the state. The index is considered the most fundamental measure of housing well-being for home buyers in the state.

A minimum annual income of $115,200 was needed to qualify for the purchase of a $610,850 statewide median-priced, existing single-family home in the second quarter of 2020. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $2,880, assuming a 20 percent down payment and an effective composite interest rate of 3.43 percent. The effective composite interest rate was 3.70 percent in first-quarter 2020 and 4.17 percent in second-quarter 2019. 

Housing affordability for condominiums and townhomes was unchanged from first-quarter 2020, with 44 percent of California households earning the minimum income to qualify for the purchase of a $480,000 median-priced condominium/townhome. An annual income of $90,400 was required to make monthly payments of $2,260. Forty percent of households could afford to buy a median-priced condominium/townhome a year ago.

Compared with California, more than half of the nation’s households (57 percent) could afford to purchase a $291,300 median-priced home, which required a minimum annual income of $54,800 to make monthly payments of $1,370.


Key points from the second-quarter 2020 Housing Affordability report include:

  • When compared to a year ago, housing affordability improved in 44 tracked counties and declined in one county. Affordability remained flat in four counties.

  • In the San Francisco Bay Area, affordability improved from second-quarter 2019 in every county, except Solano, which was unchanged. San Mateo and San Francisco counties were the least affordable, tied at 19 percent of households able to purchase the median-priced home. Forty-six percent of Solano County households could afford the $485,000 median-priced home, making it the most affordable Bay Area county.

  • Affordability also improved in all Southern California regions, with Orange County being the least affordable (25 percent) and San Bernardino County being the most affordable (54 percent).
  • In the Central Valley region, eight counties experienced an improvement in affordability from a year ago, and three counties stayed flat, San Benito County (39 percent) was the least affordable and Kings County (60 percent) was the most affordable. 

  • Housing affordability improved in all four counties in the Central Coast region.

  • During the second quarter of 2020, the most affordable counties in California were Lassen (68 percent), Kings (60 percent), San Bernardino (54 percent), Siskiyou (54 percent), Tehama (54 percent), and Tuolumne (54 percent). The minimum qualifying income was $61,200 or less for each of these counties.  

  • Mono (17 percent), San Francisco (19 percent), and San Mateo (19 percent) were the least affordable counties in the state. Both San Mateo and San Francisco had a minimum qualifying income of over $320,000 to purchase a median-priced home in second-quarter 2020; San Francisco County required the highest income of all counties in California at $322,000. 


See C.A.R.’s historical housing affordability data.
See first-time buyer housing affordability data.



Leading the way…® in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS® ( is one of the largest state trade organizations in the United States with more than 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.


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