Mortgage Rates, Home Values Hinder Buying

California has expensive real estate, as much of the country knows. Even as the national median home price fell, many Californians still cannot afford to buy a first time home. For those that own property in the state, refinances are a hot commodity, as home values remain high. The high price tags, however, keep first time homebuyers from the market. In the last quarter, the amount of first time homebuyers in the state of California that could afford entry-level housing fell to 24% as mortgage rates inch up and home values remain high.

The new numbers are a four percent decrease from the same quarter a year ago. The statistics come from determining the minimum household income required to make a 10% down payment on an entry-level home with the average mortgage rate (between fixed and adjustable) of 6.58. The only areas of California that saw growth in first time homebuyers were the northern desert of Los Angeles and the desert side of Sacramento.\r\n