CA Counties With Most Affordable Home Prices: New Data

CALIFORNIA — Homeownership, once equated with achieving the American Dream, is farther out of reach for many residents of the Golden State than it has been in a decade, according to a new analysis.

NBC News, which conducted the analysis, said the affordability gap for homebuyers is nearing a 10-year high amid high home costs, interest rate hikes and a shortage in the nation’s housing supply. The affordability gap is an estimate of the difference between an area’s median household income and payments on a median-priced home in that area.

A home is generally considered affordable if payments on a 30-year fixed-rate mortgage don’t exceed 30 percent of pretax income, according to NBC.

The 2023 before-tax median income in California was $54,030, according to the Bureau of Labor Statistics. The NBC analysis suggests a person with income at this level would be able to afford to live in most places in the country, except California.

Only Lassen County, which neighbors Shasta County in Northern California, is considered an affordable place to live for Californians earning the median income. Outside the Golden State, 1,321 counties in the U.S. are affordable, including most of Illinois, Texas, Louisiana and other Mid-West states.

Two-income families have a better chance of finding a home they can afford. Households with before-tax earnings of $108,000 would be able to afford homes in 26 California counties including the entire Central Valley but excluding most all of Southern California, the Bay Area and coastal counties.

According to the nonpartisan state Legislative Analyst's Office, the affordability gap in California has exploded since 2020. Skyrocketing home prices and mortgage rates have pushed home ownership out of reach for most California wage-earners.

According to the Legislative Analyst's Office, California homes are about twice as expensive as the typical U.S. home.

"In recent years, these costs have grown substantially—in some cases, growing at historically rapid rates," the Legislative Analyst's Office notes.

The impact on monthly housing costs has had a dramatic impact on buyers, who now have to spend thousands more per month on the same house purchased in 2024 versus the same house purchased in 2020.

NBC noted widespread geographical differences in the affordability gap. A median salary of $60,690 in Massachusetts — the top-paying of the states — puts affordable housing out of reach in that state. Nationally, that person could afford to buy a house in 1,618 out of the 2,801 U.S. counties.

A person in Mississippi, which has the lowest median annual income of $37,500, would only be able to afford to buy a house in 531 of 2,801 counties.

Today, a household earning the local median income would be able to afford a home in 60 percent of counties nationwide, compared with 90 percent of counties five years ago, NBC said, adding that the affordability gap is growing even in counties with lower-priced homes.

» Go to NBC and use the slider tool on the map to make your own comparisons.