kpix-7-2013-masthead kcbs 7-2013-masthead

Local

Zillow: 55% Of Bay Area Homes Not Affordable, Prices Rising Beyond Historic Highs

By Brandon Mercer
View Comments
A sign stands in front of a home for sale in San Francisco (Justin Sullivan/Getty Images)

A sign stands in front of a home for sale in San Francisco (Justin Sullivan/Getty Images)

Get Breaking News First

Receive News, Politics, and Entertainment Headlines Each Morning.
Sign Up

For similar articles, visit the Your Home section.

your home listical graphic Zillow: 55% Of Bay Area Homes Not Affordable, Prices Rising Beyond Historic Highs
Trending Stories On CBS SF

quake flash 082614 Zillow: 55% Of Bay Area Homes Not Affordable, Prices Rising Beyond Historic HighsSome Bay Area Residents Report Mysterious Flashes In The Sky During Napa Quake

desmond hague elevator Zillow: 55% Of Bay Area Homes Not Affordable, Prices Rising Beyond Historic HighsCaught On Camera: Alleged Dog Abuse By CEO Of Company Tied To 49ers, Giants

nicholas dillon copy Zillow: 55% Of Bay Area Homes Not Affordable, Prices Rising Beyond Historic HighsTeenager Crushed By Chimney In Napa Earthquake Speaks From Hospital Bed

454087234 8 Zillow: 55% Of Bay Area Homes Not Affordable, Prices Rising Beyond Historic HighsStrong Magnitude 6.0 Earthquake Rocks San Francisco Bay Area, Dozens Hurt, Significant Damage In Napa

keyframe22 Zillow: 55% Of Bay Area Homes Not Affordable, Prices Rising Beyond Historic HighsCaught On Camera: Concord Thief Uses Mystery Electronic Device To Break Into Car

SAN FRANCISCO (CBS SF) — More than half of the homes in the Bay Area are “unaffordable,” and median income home buyers are spending more on mortgages now than they before the real estate bubble, according to a study released Friday by Zillow.

Home buyers in the five-county region defined by Zillow spend 39.3 percent of their income or $2530 per month on the mortgage for a median-priced home.   That’s compared to just 37.7 percent from 1985-2000, what is considered the “pre-bubble” years.

Nationally, just 33 percent of homes are considered “unaffordable” according to Zillow.

The situation for the Bay Area will get worse if mortgage rates rise.  An increase to just 5 percent would mean the Bay Area spends 45.9 percent of their monthly income on mortgage payments, not to mention insurance and taxes.

CRAZY HOME PRICES: $1.6 Million Fixer-Upper

In February, 45 percent of homes for sale were considered “affordable,” meaning the majority of 55 percent were unaffordable.

The only affordable homes are in suburbs, leaving Bay Area home buyers with increasingly longer commutes.

The image below shows the most affordable homes, approaching 100 percent are in the far eastern parts of Contra Costa County, southern Alameda County and northern Contra Costa County. San Francisco, Orinda, Lafayette, Walnut Creek, and most of the Silicon Valley are colored in deep red, meaning nearly 0 percent of homes considered affordable.

INTERACTIVE: Explore An Interactive Version Of This Zillow Graphic 

Zillow graphic from April 4th, 2014 showing affordability of homes. (Credit Zillow)

Zillow graphic from April 4th, 2014 showing affordability of homes. (Credit Zillow)

 

Other markets including Southern California, Denver, Portland, and Miami are in a similar situation, but San Francisco tops the list of most unaffordable.

“As affordability worsens, we’re already beginning to see more of the kinds of worrisome trends we saw en masse during the years leading up to the housing crash,” said Zillow economist Stan Humphries.

“These include a greater reliance on non-traditional home financing, smaller down payments and a greater pressure to move further away from urban job centers in order to find affordable housing options,” said Humphries. “We’re not in a bubble yet, but we’re beginning to see the early signs of one in some areas.”

View Comments
blog comments powered by Disqus
Follow

Get every new post delivered to your Inbox.

Join 53,874 other followers