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Thursday
May172012

Southland Housing Affordability Hits New High

Despite Gains, Affordability Still Far Lower Than Most Parts of U.S.

IRVINE – Buying a home in Southern California is within the reach of more families than at any time so far this century, according to the latest Housing Opportunity Index released today by the National Association of Home Builders.

Despite that positive trend, however, housing prices in California remain among the least affordable in the nation, leading the CEO of the Building Industry Association of Southern California to urge local and state governments to work with homebuilders to ease fees and regulations that continue to drive up costs.

“Between state laws that encourage lawsuits to block housing developments and local government fees and requirements that can add anywhere between $20,000 and $100,000 to the price of each new home, it’s always been difficult and expensive to build in Southern California,” said David W. Shepherd.

“In this market, every dollar counts and the competition with foreclosed homes and short sales remains fierce. We look forward to partnering with state and local governments to reduce fees, speed up processing times and craft other measures to make more projects pencil. That will create jobs, generate tax dollars and allow more families to buy today’s exciting new homes. ”

During the first quarter of 2012, 49.5 percent of the homes sold in Los Angeles County could be afforded by a family earning the county’s median income. That was up slightly from the previous quarter and up by more than 6 percentage points from the same period in 2011. In comparison, just 1.8 percent of the homes were affordable at the low point, set in the first quarter of 2006, and the county was the nation’s least affordable housing market.

Affordability also hit new highs for the century in the other metro areas in BIASC’s service territory, ranging from 83.7 percent in Imperial County to 50.7 percent in Orange County. (See table below for details.)

However, L.A. County was the fifth least-affordable metro area in the country during the quarter and Orange County ranked sixth-lowest. The two Southland metro areas joined San Francisco and San Diego in the bottom 10 among metro areas nationwide.

Metro Area

Imperial County

Los Angeles County

 

 

 

 

Lowest*

 

 

 

Lowest*

 

1Q12

4Q11

1Q11

4Q06

1Q12

4Q11

1Q11

1Q06

Median price (000)

121

132

133

280

295

295

300

523

HOI

83.7

76.5

74

6.8

49.5

48.3

43.1

1.8

Nat’l Rank**

112

59

66

T11

5

6

3

1

 

Metro Area

Orange County

Riverside/San Bernardino

 

 

 

 

Lowest*

 

 

 

Lowest*

 

1Q12

4Q11

1Q11

1Q06

1Q12

4Q11

1Q11

3Q06

Median price (000)

384

392

400

608

165

168

175

393

HOI

50.7

47.4

44.8

2.5

77.5

75.7

74.9

6.7

Nat’l Rank**

6

4

5

2

60

56

70

13

 

Metro Area

Ventura County

 

 

 

 

Lowest*

 

1Q12

4Q11

1Q11

2Q06

Median price (000)

320

320

333

586

HOI

67

66.1

59.7

8.1

Nat’l Rank**

24

28

19

18

*Lowest – the lowest affordability ranking since 2000 or since data has been collected for that metro area.

**National rank counts from the bottom of the affordability list. The lower the number, the more unaffordable a metro area is nationwide.

 

###

 

EDITOR’S NOTE: The NAHB/Wells Fargo Housing Opportunity Index is a measure of the percentage of homes sold in a given area that are affordable to families earning that area’s median income during a specific quarter. Prices of new and existing homes sold are collected from actual court records by First American Real Estate Solutions, a marketing company. Mortgage financing conditions incorporate interest rates on fixed- and adjustable-rate loans reported by the Federal Housing Finance Board.

The NAHB/Wells Fargo HOI is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. Please visit www.nahb.org/hoi for tables, historic data and details.

The Building Industry Association of Southern California, Inc., is a non-profit trade association representing nearly 1,000 member companies in the housing industry, construction trades, and affiliated businesses throughout Southern California. Along with its four chapters – Los Angeles/Ventura, Orange County, Riverside County and Baldy View – it advocates on behalf of the homebuilding industry throughout Los Angeles, Ventura, southeast Kern, Orange, Riverside, Imperial and San Bernardino counties. Visit its Website at www.biasc.org.

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