California Housing Affordability Improves in 4th Quarter 2021, C.A.R. Reports

A tempering of home price growth combined with a solid increase in household incomes improved the affordability outlook for Californians in the fourth quarter of 2021, the California Association of REALTORS® (C.A.R.) said on Thursday.

The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in fourth-quarter 2021 inched up to 25 percent from 24 percent in the third quarter of 2021 but was down from 27 percent in the fourth quarter of 2020, according to C.A.R.'s Traditional Housing Affordability Index (HAI). The fourth-quarter 2021 figure is less than half of the affordability index peak of 56 percent in the first 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.

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