I’m not sure. I understand the median household income for Southern California is around $70K. (Though I find that hard to accept.) I understand the mortgage industry’s affordability rule is (or should be) 2.5 times household income. So if household income is ~$70K that means affordability is somewhere around $175K. This implies there is a huge disparity here when you consider a decent median home in SD or Orange County is going for $400-500K plus! Even if you double the median household income to $140K it is still not close enough to make sense. Any wonder why many homes in the $500K (asking) plus range are hard to sell? With that, I see a drop of more than just single digits. Simply stated, your mortgage has to be within the means of your salary- for most of us at least.
