Affordable Housing Alert: Get Out of L.A.

Half Million Dollars Doesn't Buy Much in L.A.(April 13, 2006) --

If you're looking for an affordable home, steer clear of Los Angeles. Southern California continues to be one of the most expensive places in the country to buy a house, new research shows.

Median prices in Los Angeles County passed $500,000 for the first time last month, according to DataQuick Information Systems, which analyzes property transactions. In March, the median hit $506,000, up 15 percent from a year earlier and 3 percent from February.

Orange and Ventura counties' medians sailed through the $600,000 level in the middle of last year, and San Diego's broke through the $500,000 point last fall.

$500,000 doesn’t buy a palace. Forget Beverly Hills. It might get you 1,500 square feet with three bedrooms and two baths in South Los Angeles.

To buy a house at the median price, a household would need an annual income of at least $120,000 to qualify for conventional financing with a 20 percent down payment. The Los Angeles County's median household income is $47,000.

Source: Los Angeles Times, Annette Haddad (04/13/2006)

Ed.'s Note: That statistic at the bottom of the paragraph is an interesting one, isn't it? My question remains, who then is buying up all these median priced homes in the $500,000 range? If they're merely priced there, then the situation will work itself out, but if they're also selling there, then to whom?