Affordability of HUD Homes and Other Residences Got Better in CA- By: Clark Raitz
The chances of first time homebuyers in California to acquire residences, including non-foreclosure and foreclosed bank and HUD homes, have improved in the 2010 third quarter. According to the California Association of Realtors, home affordability in the state got better compared with the previous quarter and with last year.
For the July-September 2010 period, more buyers were able to afford Los Angeles auction homes and other types of residential properties all around California. Around 66% of first time purchasers are considered able to afford an entry level dwelling in the state for the quarter. The percentage is a slight improvement compared with the 65% recorded in the second quarter of the current year and the 64% recorded in the 2009 third quarter.
State realtors have revealed that first time homebuyers usually purchase houses that are equal to 85% of the median price prevalent in the market. They also revealed that for first time buyers to afford HUD homes and other residential properties that fall within the median price requirement, a minimum yearly income average of $42,300 is needed. This average annual earning will qualify a buyer to acquire an entry level residence in the 2010 third quarter worth $266,620.
The average monthly payment for Los Angeles auction homes and other entry level housing units for the quarter was around $1,410 that already includes insurance and taxes. This monthly rate is for a typical purchase that required a 10% down payment and a 3.66 adjustable interest rate. For the whole California state, the region of High Desert was considered the most affordable for the quarter in focus with a rating of 85%. At the opposite end is San Francisco Bay, which has been considered the least affordable area at 51%.
Meanwhile, buyers of HUD homes and other residential properties in the Santa Clara County and the Santa Barbara region also have improved chances of acquiring dwellings, with both areas having an affordability percentage of 53. According to analysts, the slight increase in the affordability index might encourage some buyers sitting in the sidelines to make a purchase before the year ends. They added that a big number of potential homebuyers are sitting it out and waiting for further decreases in home selling prices.
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