Orange County Home Affordability Plummets as Income Requirement Doubles in 5 Years

Households in Orange County now need an annual income exceeding $373,200 to afford a median-priced single-family home, according to a new report.

The California Association of Realtors (CAR) revealed in its 2025 first-quarter Housing Affordability Index report that buyers must earn $373,200 per year to purchase a median-priced home costing $1.45 million in Orange County. The estimate assumes a 20% down payment, allocating 30% of income toward mortgage principal and interest, and covering property taxes and insurance totaling 1.4% of the purchase price.

Income requirement up 129% in five years

The required annual income to purchase a home in Orange County has surged 129% compared to five years ago. CAR attributed this to a 75% increase in home prices during that period and a jump in mortgage rates from 3.89% at the end of 2019 to 6.93%.

As a result, only 12% of households in Orange County now meet the income threshold to buy a median-priced home, down sharply from 26% five years ago.

Southern California sees similar affordability decline

In Southern California, buyers now need an annual income of $213,600 to afford a median-priced home at $830,000, reflecting a 97% increase from five years ago. Over the same period, the share of households able to afford such homes has dropped from 33% to 15%.

CAR noted that across California, the required annual household income to purchase a median-priced home has nearly doubled over the past five years, signaling a widespread affordability crisis.

BY SANGHWAN LIM [lim.sanghwan@koreadaily.com]