California Dream Fades: Homeownership Slips for All Ethnic Groups, C.A.R. Finds

Key Highlights:

• Only 18% of Californians could afford a median-priced detached home ($865,440) in 2024, down from 19% in 2023.

• Affordability by group: 27% of Asians, 21% of Whites, 10% of Blacks, and 9% of Hispanics/Latinos could afford a median-priced home.

• Minimum income needed: $221,200 to qualify for a $5,530 monthly mortgage payment at a 6.84% interest rate.

• Homeownership rates (2023): 64.4% for Whites, 61.5% for Asians, 45.9% for Hispanics, and 36.6% for Blacks.

• Affordability gaps narrowed slightly but remain wide, especially for Black and Hispanic households.

• C.A.R.’s closing cost grant program has distributed $3 million to 312 first-time buyers from underserved communities since 2022.

• National comparison: 54% of Asians and 41% of Whites could afford a median-priced U.S. home, versus 32% of Hispanics and 24% of Blacks.

Homeownership became even less attainable across all ethnic groups in California in 2024, as rising mortgage rates and high home prices pushed affordability further out of reach, according to the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.).

Only 18% of Californians earned enough to purchase the $865,440 median-priced detached home, down from 19% in 2023. Among ethnic groups, 27% of Asians, 21% of Whites, 10% of Blacks, and 9% of Hispanics/Latinos could afford a median-priced home.

To qualify, a household needed an annual income of $221,200 for monthly mortgage payments of $5,530 (assuming a 20% down payment and a 6.84% interest rate).

While housing affordability gaps between ethnic groups narrowed slightly, major disparities persist. The affordability gap between Black households and the overall population shrank from 8.9 percentage points in 2023 to 8.0 points in 2024. For Hispanics/Latinos, it improved from 9.4 to 8.3 points. Despite these slight improvements, the homeownership divide remains stark, particularly as home prices are expected to continue climbing in 2025.

California’s 2023 homeownership rates reflect these disparities:

• 64.4% for Whites

• 61.5% for Asians

• 45.9% for Hispanics/Latinos

• 36.6% for Black households

Nationally, 54% of Asian, 41% of White, 32% of Hispanic, and 24% of Black households could afford the U.S. median-priced home in 2024.

In response, C.A.R. has ramped up efforts to close the gap, offering up to $10,000 in closing cost grants through its Pathway to Home Closing Cost Assistance program. Since launching in 2022, the program has distributed $3 million to help 312 first-time buyers from underserved communities and expects to reach $4 million and 415 households by the end of 2025.

Regional Affordability Highlights:

• Largest affordability gaps for Black households were found in Contra Costa (-14%), Kern (-13.4%), and San Francisco (-13.1%).

• Biggest gaps for Hispanic/Latino households appeared in Santa Clara (-10.3%), Contra Costa (-10.2%), and Solano (-9.8%).

• Least affordable counties for Black homebuyers: San Mateo (5% affordability); for Hispanics: Orange County (7%).

• Most affordable counties:

  • For Black households: San Joaquin (34%), Fresno (31%)

  • For Hispanics: San Bernardino (32%), Kern (30%), Fresno (28%)

  • For Asians: Kern (59% affordability)

  • For Whites: Fresno (43% affordability)

C.A.R.’s Housing Affordability Index (HAI) remains the benchmark for measuring the housing market’s accessibility across ethnic and regional lines.

Source: C.A.R. 

CALIFORNIA ASSOCIATION OF REALTORS^®
2024 Traditional Housing Affordability Index by Ethnicity

* Assumes 20 percent downpayment