While affordable housing covers many different income levels and price ranges, what makes housing "affordable" is the rent or mortgage payment relative to the individual's or family's income. According to the federal government, rental housing is "affordable" if the people living there pay no more than 30 percent of their income for rent. According to mortgage lenders, a home is affordable if the mortgage payment is not more than 35 percent of the borrower's income. So, what's affordable depends on income.
What is Area Median Income? Each year, the federal government calculates the median income for communities across the country. Median means that half of the households are above this income level, and half are below. Area median incomes are adjusted for family size. In Los Angeles County, the median family income was $53,100/year in 2004. Sometimes you will see different figures for median income for Los Angeles that are as much as $2,000/year apart. This comes from different government agencies "adjusting" the federal figure.
