Buying a home in 3 CA cities just got easier. Here’s how much income you’ll need
It’s getting a little easier to buy a home in parts of the United States.
In nearly a dozen major cities — including three in California, the income needed to buy a typical home has gone down over the past year, according to real estate site Redfin.
This is mostly because home prices have dropped and more houses are for sale, the site reported.
“Buyers are battling affordability and they see a lot of listings sitting on the market, so they’re asking for major concessions,” Katie Shook, a Redfin Premier real estate agent in Phoenix, said in an Aug. 6 report.
For the past eight months, Shook said, it’s been a buyer’s market.
“If your home isn’t in 10/10 condition and priced at or below market value, it’s going to linger on the market,” Shook said.
However, many sellers are offering $10,000 to $15,000 to help cover buyers’ closing costs, according to Shook.
If you’re in the market for a new home in California, here’s what to know about how much you need to earn and where housing affordability is improving:
How much do I need to earn to buy a home?
Across the country, the average homebuyer needs to earn about $112,000 a year to afford a median-priced home, which is nearly $25,000 more than what the typical household earns.
While the median home price in the United States has barely changed in the past year, rising just 0.5% to $447,035, California’s average home value is much higher at $775,058, as of Tuesday, Aug. 12, according to Zillow.
However, in 11 of the country’s 50 biggest metropolitan areas, buying a home has actually become more affordable.
Where is it getting easier to afford a home in California?
According to Redfin, Oakland is seeing the biggest improvement in homebuying affordability.
To buy a home in the Bay Area city, you need to earn about $244,073 a year.
“While that’s high compared to most places, it’s down 4.6% year over year—the largest decline among the 50 most populous U.S. metropolitan areas,” Redfin said.
Other cities with noticeable drops include San Diego, which ranked fourth.
The needed income to buy a home in the Southern California city dropped 3.2% to $227,612.
Sacramento also saw a decline, ranking 11th among cities with improved homebuying affordability.
The state capital’s required income decreased 0.4%, and is now at $150,939.
Where is it getting easier to afford a home in United States?
West Palm Beach, Florida, ranked second, with the income needed to afford a home falling 3.7% to $128,950. Jacksonville, Florida, was third, where the required income dropped 3.5% to $94,618.
Tampa, Florida, ranked fifth, with a 2.1% decrease to $97,463. Atlanta was sixth, down 2% to $103,719, and Phoenix was seventh, with a 1.8% drop to $109,719.
St. Louis came in eighth, down 1% to $75,478, while Orlando, Florida, was ninth, with a slight decrease of 0.7% to $104,644.
Dallas ranked 11th, where the required income fell 0.2% to $120,542.
How did Redfin come up with its findings?
To come up with its findings, Redfin used U.S. Census Bureau data on 2023 median household income, adjusted with wage growth trends from the Federal Reserve Bank of Atlanta.
In its report, Redfin considered a home “affordable” if a buyer spends no more than 30% of their income on monthly housing costs, and “homebuyer” meant someone using a mortgage to purchase a home.
The income needed to afford a typical home is based on the median sale price and average mortgage rate in June, with a 20% down payment.
Monthly housing costs included the mortgage payment, property taxes, homeowners insurance and mortgage insurance.
This story was originally published August 18, 2025 at 5:00 AM with the headline "Buying a home in 3 CA cities just got easier. Here’s how much income you’ll need."
