How's the Housing Market Where You Live?

Okay, if you live in California, especially if you live in the Bay Area, this is going to depress you.But, if you live just about anywhere else, this will encourage you and make you thankful for real estate costs where you live. (FYI, per the chart below, the county I live in is San Mateo County.) Below are some excerpts from an article by James Temple in today's San Francisco Chronicle about the current California housing market.

Despite recent declines inthe cost of California real estate, median home prices remainunaffordable throughout the state, according to a report by a liberalresearch and advocacy group calling on the governor and state lawmakersto confront the issue.The authors of "Locked Out 2008: The Housing Boom and Beyond," thestudy released today by the California Budget Project of Sacramento,said median incomes aren't enough to buy median-priced homes... The report assumes homes areout of reach if households have to dedicate more than 30 percent oftheir income to housing costs, the level above which the U.S.Department of Housing and Urban Development says people may havedifficulty affording necessities such as food, clothing andtransportation.More than half of homeownerswith a mortgage exceed that level in California, according to a 2006survey by the U.S. Census Bureau. The lack of affordability is acute inthe Bay Area, where the earnings required for purchasing amedian-priced home is more than double...

High prices

Because of the high cost of housing in California, residents:--  Have the second-lowest homeownership rates, at 58.4 percent, just ahead of New York.--  Face the second-highest rental rates in the nation, 41.6 percent, just behind Hawaii.-- Spend a larger share of their incomes on housing than residentsof other states, with 43.5 percent allocating more than 30 percent oftheir earnings on shelter, compared with 29.1 percent in the rest ofthe country.-- Are more likely to live far from their jobs, with 10.1 percentspending at least an hour commuting, compared with 7.9 percent for thecountry as a whole.-- Are more likely to live in crowded rental housing, with 13percent packing in more than one person per room, compared with 5.8percent for the country as a whole.

Out of reach

The cost of homes in the Bay Area is so high, it takes much more than the median income to afford one.

County	Residents who own homes	Income needed to afford a home{+1}	Households spending over half of income{+2}
Alameda	57.4%	$148,450	18.8%
Contra Costa	72.0	138,715	18.6
Marin	65.0	218,902	20.5
Napa	62.5	145,408	19.6
San Francisco	39.3	196,878	19.6
San Mateo	63.2	191,768	19.2
Santa Clara	60.6	170,352	17.4
Solano	65.9	103,185	20.7
Sonoma	63.9	124,114	19.5

{+1}With a 5 percent down payment on a median-priced home{+2}To pay for homesFor more information or to read the full report, visit: www.cbp.org So, are you depressed or encouraged? What are housing costs like where you live?