“Payment Pulse” deals with the harsh reality of homebuying finances for Southern Californians. It’s really about the size of the monthly check to the lender, not the sale price.
Buzz: A typical February homebuyer in the six-county area paid 15% more than a year earlier and secured a 26% higher house payment thanks to rising interest rates.
Source: My trusty spreadsheet examined what is becoming a boiling mix: the intersection of higher house prices (monthly median from DQNews) and rising mortgage rates (30-year average offers from Freddie Mac), which, combined, generate a hypothetical monthly home loan payment. , assuming a 20% down payment. We have not considered property taxes, association dues or insurance.
Rate the watch: 3.44% average over three months against 3.21% the previous month and 2.74% a year earlier. What does this mean for a borrower’s purchasing power? In one month, it was a drop of 2.8%. One year? A decrease of 8.5% – a decline over 91% of all 12-month periods since 1988.
Pay to the order of
In the Six Counties area, last month’s buyer received a payment of $2,517 for the new record median price of $706,000. This payout is 2% below the record high set in August 2007.
The estimated payout is 6.1% higher in one month and 26% higher in one year – the biggest 12-month jump since March 2014. The median itself is up 15% since February 2021.
And, don’t forget that this calculation assumes a down payment of $141,200 for February – that’s 20% – a financial burden that has increased by $18,800 in one year.
Let’s look at county house payment calculations…
Los Angeles: Record payout of $2,852 out of a median of $800,000. Payment change: increase of 4.1% in one month and 24% in one year. Median: +13% over 12 months. Down payment: $160,000 — up to $18,600 in one year.
Orange: Record payout of $3,512 on record median of $985,000. Payment change: increase of 6.7% in one month and 31% in one year. Median: +20% over 12 months. Down payment: $197,000 — up to $33,000 in one year.
Riverside: Payout of $2,015 on record median of $565,000. This payout is 7% below the all-time high. Payment change: increase of 5.7% in one month and 32% in one year. Median: +20% over 12 months. Down payment: $113,000 — up $19,100 in one year.
Saint Bernardine: Payment of $1,729 out of the median of $485,000. This payout is 8% below the all-time high. Payment change: increase of 5.1% in one month and 29% in one year. Median: +18% over 12 months. Down payment: $97,000 — up to $14,600 in one year.
At the end of the line
Think about these rising costs in historical context. Rarely have prices and tariffs put more pressure on house hunters.
Regionally, the home payment estimate of the year exceeds 96% of all 12-month periods since 1988. By county: Los Angeles (93%), Orange (96%), Riverside (96 %), San Bernardino (92%), San Diego (95%) and Ventura (94%).