California’s Housing Price Contrast

California showcases a wide range of housing prices, from luxurious properties owned by tech giants to high-priced beachfront homes in Malibu. In affluent regions, high salaries often offset high housing costs. Meanwhile, gentrifying urban areas may still seem unattainable for long-time residents. The Los Angeles Times examined the most and least affordable places in California, based on the ratio of home prices to median household income. This ratio indicates the number of income years needed to buy a median-priced home in any given area. Some affordable places require four years’ income, while others demand up to fourteen years of pretax earnings.

Most Affordable Communities

Affordable communities often lie far from major job centers, primarily in the Central Valley. Richard Green, director and chair of the USC Lusk Center for Real Estate, notes these areas have plentiful land and favorable regulations, allowing for higher housing supply. Residents in these places typically earn standard California incomes, yet experience lower housing costs.

• East Niles: Median home value $251,500 with a population of 28,532. Residents need 4.56 years of income to purchase a home. This area sees low housing costs, though commuting to L.A. takes about two hours.
• Tulare: Median home value $329,800, population 70,945, needing 4.55 years of income. Located in Central Valley, its economy revolves around agriculture.
• Visalia: With a $371,500 home value and population of 143,939, this city requires 4.53 years of income. Known for its historic downtown, Visalia is an emerging affordable community.
• Delano: Median home value $301,900, a population of 51,679, requires 4.51 years of income. Delano’s economy leans on agriculture and local prisons.
• Rosamond: Home value $352,600, population 21,473, and a 4.44-year income requirement. Offers aviation heritage and proximity to Edwards Air Force Base.
• Twentynine Palms: With homes priced at $268,200 and a population of 27,355, residents need 4.29 years of income. Gained popularity during the pandemic.
• Imperial: Home value $360,900, population 21,430, demanding a 4.00-year income. Notable for resisting a data center construction.
• Corcoran: With a $236,100 home value, 22,491 inhabitants, residents require 3.94 years. Agriculture and a state prison complex characterize this area.
• Lemoore: Median value $328,300, population 27,102, 3.92-year income needed. Hosts the Naval Weapons Station Lemoore.
• Ridgecrest: Home value $253,900 with 28,225 residents, requiring 2.84 years of income. Recognized post-2019 earthquake.

Least Affordable Communities

Expensive areas often have ocean views or are tied to key industries. Coastal communities typically incur higher costs, with a few outliers making the list as well.

• San Luis Obispo: Houses cost $935,100 with a population of 48,491, needing 12.69 years of income. Despite its small size, real estate remains challenging.
• Arcadia: Median home value $1,441,800, population 55,170, 12.70-year income required. Offers safe streets, excellent schools, but high housing prices.
• Newport Beach: Home value $2,000,001, 83,845 inhabitants, demanding 12.75 years. Known for luxurious ZIP Codes and high-end living.
• South Pasadena: Median home cost $1,640,000, population 26,068, needing 12.90 years. High real estate prices due to attractive amenities.
• Westmont: Home price $653,800, population 34,123, requiring 12.94 years. Surprising addition due to recent housing price increases.
• Berkeley: With homes at $1,413,900, 120,257 residents, 13.08-year income needed. High real estate shifts from past counterculture era.
• Laguna Beach: Property value $2,000,001, population 28,532, needing 13.90 years. Affluent enclave offering artsy allure.
• Santa Barbara: Home price $1,570,800, population 87,779, 14.79-year income requirement. Less costly than some beach towns, but commute to L.A. is challenging.
• Beverly Hills: Median value $2,000,001, 31,624 residents, demanding 15.04 years. Iconic for luxury living and high property costs.
• Santa Monica: With $1,755,500 home values and 91,169 inhabitants, residents need 15.28 years of income. Median income lower due to many apartments.

Why Southern California Tops the List

Most high cost-to-income ratios occur in Southern California, even as Silicon Valley’s home prices rise. While Bay Area home values are high, their incomes, driven by the tech industry, offer compensation.

Many Southern Californians purchased homes decades ago when they were cheaper, contributing to prolonged residence. Proposition 13 assists in keeping property taxes manageable.