Los Angeles is the most unaffordable place to rent with renters spending nearly 50 percent of their income on rents: San Francisco is the most expensive place to purchase a home.
ByWhen I made the claim that Los Angeles is the most unaffordable place in the nation to rent a few people shouted out by saying that San Francisco and New York were more expensive. Of course, these people didn’t bother to look at the data or understand what being unaffordable means. What it means is that based on household incomes in Los Angeles and current rents, people spend a larger portion of their income on housing. This is why Los Angeles is undergoing a rental Armageddon. The cheerleader brigade simply thinks that because rents have risen that somehow this equates to buying. But here is the thing; most can’t buy and sales volume reflects that. In fact, many young households are relegated to living with mom and dad because they don’t even have the means to pay the rent let alone buy. The trend is clear in Los Angeles: higher home prices, higher rents, more young adults living at home, and those that do buy spend a massive amount of their income on the mortgage. Take your pick in this speculative market. What is apparent is that many households in Los Angeles are living on the razor’s edge of financial insolvency…
