Mortgage interest rates doubled last year, sharply reversing 2021 record lows. That left many Californians letting go of their homeownership dreams.
California's housing market is the most unaffordable it's been in the last decade. More people than ever are moving out of state to pursue lower housing costs.
In 2021, historically low mortgage rates allowed Californians to seek out homes that would normally be too expensive. But in 2022, the Federal Reserve campaigned to address high inflation by hiking interest rates, doubling the cost of obtaining new mortgages. As a result, an estimated 400,000 Californians no longer qualified.
For those who are still looking, Tressa Pope, a Los Angeles-area mortgage broker and founder of TPG Mortgage Lending, told us:
"They had to either stop their search all together or they had to look for something in a different price range, or a different type of property. So if they were looking for a single family home, now they're moving to a condominium or townhouse and that wasn't part of their plan."
Our LAist 89.3 talk show AirTalk spoke to Pope, Logan Mohtashami, lead analyst for the real estate news site HousingWire, and Orphe Divounguy, senior economist with Zillow about the current state of affairs.
Mortgage interest rates are expected to drop again later this year, but not to the historic lows of 2021. However, the supply of affordable housing remains limited.
