Bay Area Affordability: Not So Good

Like this wasn’t something you were already aware of, right?

Recently the National Association of Home Builders/Wells Fargo Housing Opportunity Index was published. This is a quarterly index that has data going back to 1991. Looking at thehisotry of this index, I have to say that California has dominated the “Least Affordable Category.” Back in the 1990s, San Francisco was the front runner as the least affordable large metro area to buy a home in the nation. Early in 2000, there was not really a consistent winner, but the mantel was shared by Salinas, San Diego, Santa Barbara and Orange County. In 2005, the Index added in small metro areas (population 500,000 or less), and Los Angeles/Long Beach/Glendale grabbed and has held the lead over SF as least affordable large metro area, while Salinas stands strong as the least affordable small metro area (with Napa, Santa Barbara and San Luis Obispo areas each taking a turn).

On the other end of the spectrum, Indiana seems to be dominant in the Most Affordable category since 1991, with several cities in Texas, Michigan, New Hampshire, Illinois, New Jersey, New York, Wisconsin and Ohio stealing a few quarters here and there. Kokomo and Indianapolis are the two main cities in Indiana making their mark as affordable.

I have to say that this Housing Opportunity Index allows you to see statistics in a variety of ways, all laid out in various Excel report. You can have a Complete History by Metro Area, History of Least and Most Affordable, List by Affordability, List Sorted Alphabetically, Regional Listings, and much more. They do a great job of distilling the information they have into readable, usable lists.

I know, you want to know how they arrive at these conclusions. It appears that they look at the median home price, median household income, and the share of homes affordable to median-income families. The more homes that are affordable to those families, the higher the ranking on the Most Affordable List.

I looked at Regional Rankings, and found that Sacramento/Roseville has the most affordable homes in California, followed by Modesto, Stockton and Yuba City. You can check the full chart after the jump to see where in the West your area ranks…or maybe you’d like to find something more affordable than the ever-pricey Bay Area?