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You’re sipping on an oat milk latte in a trendy LA café, scrolling through home listings. You spot a charming Spanish-style bungalow with a price tag that makes your eyes widen. You think, Can I actually afford to buy a home in Los Angeles? Well, you’re not alone.
In 2024, the median price of a home in LA has hit $1.2 million, with an average price per square foot at $728. Housing demand remains strong, and mortgage rates are fluctuating. So, what does that mean for you as a potential homebuyer? Let’s break it down.
What Salary Do You Need to Buy a Home in LA?
Los Angeles real estate isn’t cheap—no surprises there. But how much do you really need to earn to afford a home here?
A general rule of thumb is that your monthly housing costs (mortgage, property taxes, and insurance) shouldn’t exceed 28%-30% of your gross income. Based on today’s home prices, you’ll need to make around $237,500 per year to afford a median-priced home in LA. With rising interest rates, this number may be even higher.
If you’re self-employed or a first-time homebuyer, you might have more challenges qualifying for a mortgage—but don’t worry, that’s where Los Angeles Mortgage Lender comes in to help you navigate the process.
Location, Location, Location!
Housing prices vary dramatically across LA. A three-bedroom home in Lancaster or Lynwood is going to cost significantly less than a two-bedroom condo in Santa Monica. And let’s not forget about the surrounding counties, where you might get more bang for your buck if you don’t mind a longer commute.
For instance, if you’re willing to explore areas like the San Fernando Valley, Palmdale, or Long Beach, you might find more affordable options without sacrificing quality of life. Plus, with remote work becoming more common, commuting concerns might not be as big of a deal as they used to be.
Down Payments & Saving for Your Dream Home
A 20% down payment on a $1.2 million home means coming up with $240,000 upfront—a hefty sum. If that number feels overwhelming, don’t worry! Many loan programs allow for lower down payments, some as low as 3%-5%.
Here’s a breakdown of what you’d need to save daily to reach a traditional 20% down payment:
- In 1 year: Save $657 per day
- In 5 years: Save $131 per day
- In 10 years: Save $65 per day
Not everyone has that kind of cash lying around, but that’s why there are financing options available. Our team at Los Angeles Mortgage Lender can help you explore low down payment loans, FHA loans, and other mortgage programs designed to fit your budget.
Don’t Become House-Poor
Qualifying for a large loan is one thing—affording it long-term is another. A lender might approve you for a mortgage that eats up 45% of your income, but that could leave you struggling to cover everyday expenses. You don’t want to be stuck in a beautiful home but unable to afford travel, dining out, or saving for retirement.
That’s why working with a trusted mortgage lender is crucial. We help you understand not just how much home you can buy, but how much home you can comfortably afford while still living your best life in LA.
The Bottom Line: Is Homeownership in LA Worth It?
Yes, LA real estate is expensive, but that doesn’t mean homeownership is out of reach. It just takes the right strategy, a solid financial plan, and the right mortgage partner.
If you’re thinking about buying a home in Los Angeles, let’s talk! Los Angeles Mortgage Lender is here to guide you through the entire home financing process, from pre-approval to closing.
📞 Call us today at 213-510-1717 to explore your mortgage options!
🔗 Start your journey here: https://bit.ly/losangelesgbp
