The cost of housing in California is almost back to where it was before the housing crisis in 2008-2013 when so many homes were underwater. For those whose homes that were underwater, this is a good thing, but is it? For people who aren’t selling in the near or foreseeable future what this means is that you will get a new and much higher property tax bill. It also means that many in the market for their first home and middle class homeowner’s wishing to upgrade will be priced out of the California housing market.
A California Dream: Not Having to Settle for Just One Bedroom
IRVINE, Calif. — This was the state that embodied the middle-class American dream: Move west, acquire a small slice of property, perhaps with a palm tree or two.
For decades, comfortable suburbs like this one just south of Los Angeles boomed with new housing tracts designed to attract the latest arrivals. When space started to come at a premium, developers moved inland, building more homes for people who could not afford the more expensive coastal areas.
But now, cities across the state are grappling with a dwindling stock of housing that can be considered affordable for anyone but the wealthiest. In much of the state, a two-bedroom apartment or home is virtually impossible to acquire with anything less than a six-figure salary.
“It’s hard to imagine how all of California doesn’t become like New York City and San Francisco, where you have very rich people and poor people but nothing in between,” said Richard K. Green, an economist and director of the Lusk Center for Real Estate at the University of Southern California. “That’s socially unhealthy and unsustainable, but it’s where we are going right now — affordability is its worst ever, and we’re seeing a hollowing-out of the middle class here.”
“In Los Angeles, the average renter spends nearly half of his or her income on rent, according to a study released this year by the University of California, Los Angeles. To make the rent, many families have opted to double up with other families, sometimes cramming six or seven people into a small apartment.”