Cost of a Home is Headed Up in California Once Again

Cost of a Home is Headed Up in California Once Again

It’s not exactly a new problem for California. The cost of living, especially the high cost of housing, is as enduring as the sunshine.

The problem was mitigated, at least temporarily, by the economic crisis in 2008. Now six years later the cost of homes and rentals in California is moving upward again. Zillow.com, a site which tracks home prices, puts California home values up 11.5% in the past 12 months. That follows similarly strong gains the year before that. The state isn’t nearly back to 2006 peak yet but early 2008 values are now within sight.

The NY Times reports on the impact those prices are having. “A lot of people who grow up here think they can afford what their parents had, but that’s not always realistic,” an Orange County real estate agent tells the Times.

The website PayScale, which uses information from real people to compare cost of living in different parts of the country backs up people’s sense of how expensive it is here. PayScale says the cost of living in Orange County, CA is 41% higher than the national average. Nearly all of the difference is the result of housing costs, which the site pegs at 136% above the national average.

The situation in other parts of the state isn’t much better. Housing costs in LA are 97% above the national average. In San Diego it’s 104%. Not surprisingly, San Francisco is the most expensive at 197% above average. San Jose is marginally better at 164%. Sacramento looks cheap by comparison at merely 37% above the national average.

The result of these high prices are stories like the Denny Bak’s. Denny is a police officer and his wife works as a nurse. Together they make more than a six-figure salary but Mr. Bak tells the NY Times, “It’s just not that easy. We make good money — probably more than our
parents did — and it still feels like a struggle to stay here.”

For many, staying in the area means cramming more people into less space. Abel Ruiz lives in a one bedroom with his brother, his sister and his parents. “Do we think about moving? Sure, but that means I have to find another job, and who knows how hard that might be,” Ruiz tells the Times.


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