The cost of a single-family home in California is now $1.4 million, and the cost of one of the state’s largest housing markets is just $160 per month.
But in the Bay Area, that’s about to change.
The California Housing Finance Agency is considering raising the minimum home price by $20 per month to $1,500 per month, and then by an additional $20 for each additional bedroom in the home.
The agency is also looking at increasing the cost for a one-bedroom unit by $40.
The proposal is part of a nationwide housing affordability plan that was announced in December, and it’s aimed at creating a system of incentives that will enable low-income and working-class families to pay more to buy a home.
Under the plan, which is not set to take effect until 2022, a home owner will be required to provide at least one month’s rent, utilities, a mortgage, and a down payment, in addition to a downpayment of 30 percent.
The average amount of a downpay in California was $2,500 in 2017, and that amount will increase to $2.25 million in 2020, the California Housing Financing Agency said in a statement.
The amount of money available for a down-payment would be based on the median income of the owner and the size of their household, and not based on their wealth, according to the agency.
The state is also considering an increase in the minimum down payment requirement from 30 percent to 40 percent of the median home value.
If approved, that increase would be $150 per month for a home with a median value of $1 million, or $2 million for a $500,000 home.
The minimum downpayment requirements will be effective beginning in 2019, but the agency is still looking at ways to increase the amount of cash the owner can put down, the statement said.