L.A. Homes Too Costly for Most

RISMEDIA, Feb. 27, 2007-(MCT)-Los Angeles maintained its firm grip on the unenviable title as the nation's least affordable housing market in the fourth quarter of last year, according to a survey of released Thursday.

This is the ninth consecutive quarter that the Los Angeles/Long Beach area anchored the National Association of Home Builders/Wells Fargo Housing Opportunity Index.

In the October-through-December period, just 2% of the homes sold here were affordable to families earning a median income of $56,200. The median priced house in that time cost $525,000.

By comparison, 40.4% of homes sold nationwide in the last quarter were affordable to families earning the median income of $59,600. But the national median price averaged $248,000 during the quarter.

California also accounted for 18 of the nation's 20 least affordable markets and the top seven least affordable, according to the index.

During last year's fourth quarter, appreciation rates moderated in most of the states markets and prices fell in some. But it was not enough to change a well-entrenched trend. For example, affordability in the Los Angeles area inched up from 1.6% in the third quarter, according to the survey.

"A one or two percent drop in price has little effect on affordability," Wes Keusder, chairman of the California Building Industry Association and owner of Costa Mesa-based Keusder Homes, said in a statement.

Indianapolis, where 89%of homes sold in the fourth quarter were affordable to families earning the area's median household income of $65,100, was the nation's most affordable market. The median price there was $113,000 during the quarter.

"It's improved the past four or five months. It certainly appears that affordablility was at its worst last summer," John Karevoll, an analyst at DataQuick Information Systems, said of California's situation.

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