Tuesday, August 18, 2015

How Much Income Do You Need to Buy a Home

See how much income you'd need to afford a home in most California cities

By Phillip Reese - preese@sacbee.com
California median home prices have risen by $120,000 in the last three years, once again putting them out of reach of most households in the state.
The median sales price for homes in California - the middle-priced home in a ranked list - was $393,000 in January 2015, according to real estate tracking firm Zillow.com.
A household would need to make about $78,000 a year to reasonably afford a home at that price, assuming a 20 percent down payment. Almost two thirds of the state's households make less than $78,000, according to the U.S. Census Bureau.
The household income needed to afford a median-priced home ranges from $27,000 in the farming town of Tulare to $442,000 in the Silicon Valley town of Palo Alto.
This graphic shows the amount of income a household would need to buy the median-priced home in each California city with more than 30,000 residents.
To see a map with all the cities in California go to  lhttp://www.sacbee.com/site-services/databases/article13255952.html
For more details from across the country go to link below: 
 Update 1: Click a city on the map to see a detailed breakdown of income needed to buy a median-priced home based on down payment amount. Homes with less than 20 percent down payment include estimated mortgage insurance payments. Update 2: Graphic now includes all cities with more than 30,000 residents.
Home price data source: Zillow
Assumptions: Buyer pays 20 percent down payment. Interest rate of 4 percent on a 30-year mortgage. Annual property taxes and insurance equal 1.2% of home price. Household pays no more than 29 percent of annual gross income on housing payments. Fixed text above graphic at 3 PM on 3/12 to note that almost two-thirds of California households earn less than $78,000 annually.
Hat tip to HSH.com for the idea. Check out their calculations for the nation's largest metro areas.

Read more here: http://www.sacbee.com/site-services/databases/article13255952.html#storylink=cpy

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