SAN JOSE, Calif., March 3, 2011 /PRNewswire/ -- The percentage of households that could afford to buy an entry-level home in Santa Clara County stood at 57 percent in the fourth quarter of 2010, according to the California Association of REALTORS®. It is higher than the 52 percent for the same period of 2009, and more than double the 25 percent for the second and third quarters of 2007, the lowest since 2000.
The minimum household income needed to purchase an entry-level home at $502,350 in Santa Clara County in the fourth quarter of 2010 was $77,400, based on an interest rate of 3.39 percent and assuming a 10 percent down payment. The monthly payment including taxes and insurance was $2,580. First-time buyers typically purchase a home equal to 85 percent of the prevailing median price.
The highest affordability index for Santa Clara County occurred in the first quarter of 2009, at 62 percent. The second quarter of 2010 is the ninth consecutive quarter with the index above 50 percent since the fourth quarter of 2008. Of the 44 quarters since 2000, the index was higher than 50 percent for 17 quarters.
"Home prices in our region have gone up since the low of early 2009, but they are still affordable compared with historical data," said Mike Sibilia, president of the Santa Clara County Association of REALTORS®. "With the low interest rates, it's a good opportunity to buy, because a one-percentage drop in interest rates is equal to a 10-percent home price reduction for the buyer's monthly mortgage payment."
SCCAOR President Mike Sibilia can be reached for comments at firstname.lastname@example.org or 408.540.1711.
About the Santa Clara County Association of REALTORS®
SCCAOR, established in 1896, is California's oldest and Northern California's largest real estate association. We represent 7,000 REALTORS® and affiliate members. SCCAOR exists to meet the business, professional and political needs of its members and to promote, protect homeownership and private property rights.
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SOURCE Santa Clara County Association of REALTORS