Peter Villes, a journalist and blogger with the L.A. Times reports that 80% percent of L.A. families can't afford to buy a home based on a report released from the California Association of Realtors.
“ Now, we understand the real estate market doesn't work this way, but the Realtors try to measure "affordability," and it is worth taking a quick look at their findings. The California Association of Realtors reports that you need an income of $101,000 to buy an entry level home in Los Angeles, which means 80% of local families can't afford to buy a home.”
What's interesting to note is that the Realtors' report assumes the purchase of homes be made with an option ARM loan and about $50,000 for a down payment (10% of median-priced entry level home). I would think it would be in the Realtors' interest to take a good look at this chart .
The full article can be read here.