How much income required for a nice SFR in OC

[Charles]

Originally Posted by k374

Wanted to take a poll here on what the residents of OC think is the income required for a family in their early to late 30s with 2 kids to buy a mid sized SFR with the following basic requirements:

- Home is in good move in condition (no fixer uppers)

- Neighborhood is middle class but clean and safe with good schools

- Decent size for 4 people to live comfortably

Assumptions (going with the average family profile):

- This hypothetical family has average debt (According to statistical data the average american family has $9k credit card debt so let's go with that) - $9k cc debt, 2 average car loans ($300/mo ea. - $600/mo total), no other debts

- cash savings available for a downpayment: well, given the average savings rate of a typical middle class family I will let YOU be the judge as to how much such a family would expect to have saved up, assume they save in line with a typical family.

From this data I want you to work backwards, taking into account the neighborhood profile, debt profile, savings profile and come up with the price of a home that will MINIMALLY satisfy the requirements and what income will be required from the family to service the cost of the house.

Instead of us working really hard to figure this answer out for you, why don't you simply tell us what your housing budget is? It is practically independent of location. A housing budget is a housing budget whether it is in Orange County or Buffalo, New York. You know what you earn, you know what your debts are, you know what your down payment is, you know what size loan you can/will take. Therefore you know what you can afford. OK taxes and utilities will vary so maybe we're talking +/- 5%.

What is your housing budget?

[CAVA1990]

Originally Posted by Axiom

Point #2

Mission Viejo
Estimated median household income:
$95,878 as per census bureau as of 2010
$95,552 as per City Data as of 2009
.

Those are the current residents, not the homebuyers. Two different populations. There are probably quite a few single income retirees and other folks who've been there awhile, in some cases having paid off the house, who skew the number lower. It's not that big a stretch to imagine this hypothetical family looking to buy in South OC includes a couple of mid-level managers making $75-100K each. More likely than MIBs with suitcases full of $100 bills. They likely would have equity from a previous home plus money borrowed from their 401Ks to make the down.

The reason there's not a lot of inventory is the economy isn't producing many new jobs and worker mobility is at an all time low. People just aren't going anywhere right now.

[CAVA1990]

I'd say $125K would be sufficient. At today's interest rates that should qualify one for a $500-600K home even with a fairly low downpayment.