Affordability remained a particular worry last year for Black and Latino home-buyers in Los Angeles County, as home prices soared to record highs and interest rates jumped to levels not seen in more than a decade, the California Association of Realtors reported this week.
Throughout the state, 21% of residents earned the minimum income needed to purchase a median-priced, single-family home of $822,320 home in 2022, down from 27% in 2021. At the same time, housing affordability for white/non-Latino households fell from 32% in 2021 to 26% last year, according to the association.
Meanwhile 12% of Black and Latino households could afford the same median-priced home in 2022, down from 16% and 17% in 2021, respectively. The significant difference in housing affordability for Black and Latino households illustrates the homeownership gap and wealth disparity for communities of color, which could worsen as the economy slows and rates remain elevated this year, CAR said.
Housing affordability was better for Asians but also declined from the prior year, with the index registering 31% of Asian homebuyers who could afford the median-priced home in 2022, down from 38% in 2021, according to the association’s Housing Affordability Index.
CAR reported that the housing affordability gap between Blacks and the overall population in California improved from 11.7 percentage points in 2021 to 9.8 percentage points in 2022, while the gap for Latinos improved from 10.5 percentage points in 2021 to 9.4 percentage points in 2022. According to the Census Bureau’s American Community Survey, the 2021 homeownership rate for all Californians was 55%, 63% for whites, 60% for Asians, 44% for Latinos and 37% for Blacks.
A minimum annual income of $186,800 was needed to qualify for the purchase of the $822,320 statewide median-priced, existing single-family home in 2022, CAR determined.
The monthly payment, including taxes and insurance on a 30-year, fixed- rate loan, would be $4,670, assuming a 20% down payment and an effective composite interest rate of 5.47%. The 2022 California median income for whites was $105,640, $120,040 for Asians, $76,310 for Latinos and $64,190 for Blacks — an income gap of nearly one-third that of the overall population, which was $93,380, CAR reported.
In Los Angeles County, a minimum annual income of $192,800 was needed to qualify for the purchase of a $849,410 median-priced, existing single-family home in 2022. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $4,820, CAR determined.
In Orange County, a minimum annual income of $280,400 was needed to qualify for the purchase of a $1.2 million median-priced, existing single-family home in 2022. The monthly payment, including taxes and insurance on a 30- year, fixed-rate loan, would be $7,010, CAR reported.
11 comments for "Report: Affordability a particular worry for Black/Latino home-buyers in LA County"
Mark R. says
I’m sorry, but I see plenty of Hispanic families in my neighborhood and guess what? They all have jobs and work and have pride in their homes for the most part. Their kids are kind and polite and respect the neighborhood too.
If you can’t afford the Antelope Valley, there’s always California City, Victorville, Ridgecrest, Barstow, Needles, Las Vegas or Phoenix….or points beyond!
people keep ‘desiring’ to live here at any price, that’s the problem.
Tim Scott says
Part of it, maybe. A bigger part is that public policy to a great degree has been driven by “create wealth for property owners by building their equity” for a very long time.
Frank Rizzo says
Race bait ers at it again! Housing isn’t affordable for anyone in California!
House prices have always gone UP & DOWN like a yo-yo. Back in the ’60’s a woman’s income was never considered in purchasing a home, only the Man’s income.. Housing prices in CA are very high, & my neighorhood has a lot of wonderful Hispanics who work hard. So the solution, IMHO is to get a good education so you can command the salary to be a homeowner!!
Lies, damn lies & statistics says
Housing in California is not affordable for anyone. No matter the skin color!
Tim Scott says
Have you noticed how no matter who starts the conversation it always goes the same, and homeowners that never really made an intelligent financial decision in their lives stand quietly aside breaking their arms patting themselves on the back for their brilliance?
Ledesma 99 says
A recent estimate is that half the states population lack sufficient income required to live here.
Tim Scott says
Estimated by who, based on what?
Maybe if you specify that people can’t afford to buy a house near where they work there might be some validity to this, but there are places in California that you can buy a house for about 1000/mo house payment and I think most people with a full time job could afford that, so this ‘estimate’ needs some qualifications.
A common trend in the current housing market in California is that many are having a hard time affording to buy a house in many regions across the state.
California’s current home ownership rates sits at 54.6% in 2022, the second lowest in the nation just behind New York at 53.6%, according to the US Census Bureau. Between 2016 and 2020, nearly half of California counties had home ownership rates of less than 60% with the lowest being in more notably expensive counties like Los Angeles at 46% and San Francisco at 38%.
Ledesma 99 says
Hard hitting report. Have they finished the analogy on cross dresser and lesbian-lover home ownership pitfalls yet?