Report: LA, OC Residents Spend Half Of Income On Housing
LOS ANGELES (CBSLA.com) — If you want to live in Southern California, it’s going to cost you.
KNX 1070’s Margaret Carrero report new data released by real estate website Zillow show renters living in Los Angeles and Orange Counties lose about half their income paying their rent or mortgage to live in the least affordable housing markets in the U.S.
According to Zillow’s July Real Estate Market Reports, households earning less than $60,000 are spending half their income on keeping a roof over their head, just as housing prices are expected to rise nearly 6 percent into 2015.
The average price for a house in the LA area is around $480,000, while Orange County has an average price of around $600,000, according to Zillow.
Meanwhile, rental prices in high job growth cities like Santa Monica have soared around 20 percent in the last year, according to Zillow’s data.
Richard Green, who heads the USC Lusk Center for Real Estate, said another main factor in decreasing affordability is that average incomes in Southern California are lower than other regions with expensive housing such as New York and San Francisco.
“The typical person in Los Angeles is making considerably less money than they were 20 years ago,” Green said. “An increase in the minimum wage would help. It wouldn’t solve it, but it would help.”
Cheryl lives in Orange County and said she’s one of many who say buying a home is just not an option right now.
“It’s hard, the rent is really ridiculous,” she said.
According to Zillow, renters signing a lease in today’s current market should expect to pay nearly 30 percent of their income to rent, compared to just under percent in the pre-housing bubble period.