Home affordability has hit an eight-year low in Sacramento County, according to fourth-quarter housing data.
The median sales price of $305,000 is up 12 percent from a year ago.
"We're still seeing double-digit growth in home prices. But wages have only gone up one percent over the last year," says Daren Blomquist with ATTOM Data Solutions. "Since home prices bottomed out in Sacramento County in the first-quarter of 2012 they've risen 103 percent during that time period. And wages have just consistently not kept up with that."
The research firm puts Sacramento's home affordability index at 100, meaning market affordability is on par with historical norms.
But that's the lowest it's been since the second quarter of 2008.
Blomquist says Sacramento will likely dip below 100 in the new year.
"The path it's going on, if we continue to see this double-digit home price growth and very low single-digit wage growth, then very quickly we'll see affordability be worse than historically normal in Sacramento County," says Blomquist.
The data show if someone in Sacramento County is buying a home, and they're earning the average wage, they'll need to spend 42 percent of their income on a monthly house payment. Nationwide, the average is 34 percent. About five years ago in Sacramento County, when the region's housing market bottomed-out, it was only 22 percent.
CapRadio provides a trusted source of news because of you. As a nonprofit organization, donations from people like you sustain the journalism that allows us to discover stories that are important to our audience. If you believe in what we do and support our mission, please donate today.
