California starter-home affordability nears 4-year high

"In 2025's fourth quarter, 33% of Golden Staters would qualify for a $739,000 house with an income of $140,000. That calculation used a 5.6% mortgage rate. What's noteworthy is that this represents the highest starter-home affordability since the first quarter of 2023 when rates were also 5.6% and is a bounce off the 26% bottom of 2024's second quarter."

"The typical American enjoys easier qualification math: 57% of typical U.S. buyers would have qualified in the fourth quarter for a $353,000 starter-home requiring a $67,000 income. That's below the 70% average affordability since 2003."

"San Bernardino: 51% of households qualify for a $422,000 house, needing a $80,000 income in 2025's fourth quarter. Affordability has averaged 64% since 2003. Orange: 21% qualify for $1.2 million house with $226,000 income vs. 37% average."

California's housing affordability for first-time buyers improved significantly in the fourth quarter of 2025, with 33% of households now qualifying to purchase an entry-level home priced at $739,000 requiring $140,000 income. This represents the strongest affordability since early 2023 and a substantial recovery from the 26% low in mid-2024, driven by a 5.6% mortgage rate. However, this remains well below the 47% average affordability since 2003. Nationally, 57% of typical U.S. buyers would qualify for a $353,000 starter home. Southern California counties show significant variation, with San Bernardino leading at 51% qualification rate and Orange County trailing at 21%, reflecting dramatic price differences across the region.

Read at www.ocregister.com