Only 39 percent of the City's households own their home compared to over half statewide and nearly two-thirds nationwide. The prices of both single-family homes and condominiums have risen so steeply that the median priced home was over $400,000 in 2004. Nevertheless, there are still lower priced single-family homes and condominiums in some areas of the City of Los Angeles. The Los Angeles Times regularly publishes information provided by the company, DataQuick, on average home prices by zip code. This price list, updated monthly, can be found on DataQuick's website: http://www.dqnews.com.
The table below estimates the amount of income needed to purchase homes at various prices. The income is based on the buyer paying no more than 35 percent of annual income for mortgage payments. The monthly mortgage payments were calculated based on a 30-year fixed-rate loan at 6 percent interest, insurance at $1,500/year, and property tax at 1 percent of the home sales price.
| Home Sales Price | Down Payment at 10 percent of Sales Price | Monthly Mortgage Payment | Hourly Income Needed to Afford Home | Annual Income Needed to Afford Home |
|---|---|---|---|---|
$200,000 |
$20,000 |
$1,354/mo |
$22/hr |
$46,500/yr |
| $250,000 |
$25,000 |
$1,682/mo |
$28/hr |
$57,700/yr |
| $300,000 |
$30,000 |
$1,968/mo |
$32/hr |
$67,500/yr |
| $350,000 |
$35,000 |
$2,276/mo |
$37/hr |
$78,000/yr |
$400,000 |
$40,000 |
$2,583/mo |
$42/hr |
$88,500/yr |
| $450,000 |
$45,000 |
$2,890/mo |
$48/hr |
$99,000/yr |
| $500,000 |
$50,000 |
$3,197/mo |
$53/hr |
$109,600/yr |
Source: Karin Pally Associates
In 2004, the median income calculated by HUD for the City of Los Angeles was $53,100 so the home that the median income family could afford to purchase was one that cost between $200,000 and $250,000. This chart also shows why many families need two incomes to purchase a home and why so many can't find anything affordable.
