The general rule of thumb is that those looking to buy a new place to live shouldn’t spend more than three times their annual salary on a home purchase. But in high priced markets like California, that guideline makes it all but impossible to become a property owner.
According to a new study from LendingTree, five out of the top ten cities where buyers are stretching their budgets the most are in the Golden State. Even those earning six-figures are needing to spend more than three times their salary to buy a home in the state with median purchase prices in places like San Diego topping $600,000.
In fact, San Diego ranked first on the list of home buyers nationwide who are the most over leveraged with a median mortgage amount of $485,000 compared to a median income of $128,000.
Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 2.875 percent and 15-year rates are near 2.5 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.