Housing affordability levels in Fresno and Madera counties are falling as home prices and mortgage interest rates inch up.
Homebuyers in Fresno and Madera dedicated nearly 27% of their income to a monthly mortgage payment on a median-priced home in May, according to a second quarter affordability report from RealtyTrac, an online property data company.
That’s slightly lower than the 14-year average of 30% for both counties but growing, the report said. At the peak of the market, homeowners dedicated 50% of their income to their mortgages. When houses were cheap, the percentage fell to 19%, the report said.
The California Association of Realtors suggests buyers spend no more than 30% of their income on a monthly mortgage, said Michael Gilmore, branch manager for HomeBridge Financial Services, a mortgage lending company in Fresno.
“However in reality, there’s different measures,” Gilmore said. It depends on where the mortgage is coming from — whether it’s Fannie Mae or Freddie Mac and others — that have percentages ranging from 29% to 33%, he said.
At the end of the day, Gilmore said, affordability is tied to jobs and wages. Higher paying jobs would help, he said.