The California Association of Realtors quarterly affordability index jumped 20 percentage points from 33% to 53% between 4Q 2007 and 3Q 2008. For Los Angeles County it increased by 15 percentage points from 27% to 42%. In general the “affordability index” is percentage of households whose income is less than or equal to 40% of the PITI based upon a 90% loan at 85% of the current median price of homes sold in a particular area. Here you can find the exact affordability index methodology used by the California Association of Realtors.
The December 2008 market statistics for the Santa Clarita Valley were recently published by the Southland Association of Realtors. Closed sales transactions for all of 2008 increased by 10% and for the month they increased by 68% (year over year). Current inventory was only 4.8 months normally indicating a tight supply – but many of these homes offered for sale were distressed properties (i. e. short sales or bank owned). Median prices of closed sales for December 2008 were $385,000 (down 27%) for single family homes and $225,000 for condominiums (down 35%).
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