There’s some good news being reported this week for new home buyers and Palm Springs Realtors.
According to the California Association of Realtors (CAR), Palm Springs and the Lower Desert continue to rank high on the state’s affordability index for first-time home buyers. Affordability increased to 74 percent of prospective first-time home buyers in 2009.
According to the report, this is significantly higher than the statewide average affordability index of 64 percent and comparable to an overall affordability index in the United States of 77 percent. An affordability index of 74 means 74 percent of individuals or families looking to purchase a home in the area can afford the average monthly payments for a Palm Springs/Lower Desert median priced home of $172,320. CAR calculated the median home price in December 2009.
CAR’s affordability index is calculated based on the total monthly payment a household would be expected to make on a median priced home (including taxes, principal, interest and insurance). In order to be considered “affordable,” the total monthly payment has to be less than 40 percent of a household’s income.
The median household income for California residents is about $57,014, according to the latest figures from the U.S. Census Bureau. So, a household earning $4,751 per month could afford a total monthly payment of about $1,900 a month, which puts the Palm Springs/Lower Desert median priced home well within reach.
Palm Springs/Lower Desert ranked as the fourth most affordable region of the state compared to 15 other regions. Only Sacramento County, Riverside/San Bernardino and the High Desert scored better.
San Louis Obispo County was ranked the least affordable at 48 percent affordability.
For more information about the CAR study, visit: http://www.car.org/marketdata/marketdata/ftbhai/.
Interested or buying or selling property in Palm Springs or the Coachella Valley area? Contact Patrick Stewart Properties today.