If you live in California, you probably know about the high prices of real estate. A recent report, home affordability for the middle class has worsened in the last year. This is due to home prices rising much faster than incomes and mortgage rates. However, in the rest of the U.S., the majority of homes on the market are within reach of the middle class, since homes are still undervalued and mortgage rates are at an all-time low.
Out of the ten least affordable housing markets in the country, seven of them are in California. Supply and demand are the cause of these problems. The price of homes depends on if housing construction can keep up with the demand of houses. If there are not enough houses on the market for the number of people who are looking to buy, it can cause the prices of houses already on the market to go up.
California has recently passed a new regulation called the Small Lot Ordinance, which will allow houses to be built on smaller lots than are usually found in standard subdivisions. Home affordability will be increasing with the new construction rules and regulations leading to more houses on the market.
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