AFFORDABLE HOMES STILL SCARCE HERE L.A. AREA TOUGHEST IN U.S., NATIONAL SURVEY INDICATES.

Byline: GREGORY J. WILCOX  Staff Writer

The Los Angeles area remained the nation's least-affordable housing market for the seventh consecutive quarter in the April-through-June period, according to survey results released Tuesday.

And the 10 least-affordable large-market and small-market areas were all in California, said the National Association of Home Builders/Wells Fargo in its Housing Opportunity Index.

In the Los Angeles-Glendale-Long Beach area, just 1.9 percent of new and previously owned homes were affordable to those earning a median family income of $56,200. The median sales price during the period was $521,000.

The affordability was 1.7 percentage points less than in the year-ago period.

The Santa Ana-Anaheim-Irvine area was the second least affordable of areas of 500,000 or more residents. Of the homes sold, only 3.2 percent were affordable to those earning the area's median family income of $78,000. The median sales price was $630,000.

The dubious honor of being the 10th-least-affordable big market went to the Oxnard-Thousand Oaks area, where 8.1 percent of the homes sold were affordable to buyers earning the median income of $79,500. The median price was $586,000.

The survey tracked 199 markets and included the 10 most-affordable and 10 least-affordable markets in each of the two categories, with more or fewer than 500,000 residents. The bottom 10 of these were all in California.

Of the big markets, Indianapolis was the most affordable, with 87.4 percent of the homes sold within reach of families earning the median income of $65,100. The median sales price was $120,000.

Overall, Springfield, Ohio, was the most-affordable area in the second quarter, with 91.4 percent of the homes sold affordable to families earning the median income of $55,400. That's close to the median sales price of $85,000.

The index is not intended to show sales patterns in local markets, said Gopal Ahluwalia, staff vice president for research for the index.

``This index is not by any means an absolute measure. It's relative. It tells you how it changed over time,'' he said.

The index is based in part on the assumption that no more than 28 percent of a household's income can be used for the monthly mortgage payment. On that basis nationally, 40.6 percent of the homes sold were affordable to families earning $59,600.

But the housing market is in the midst of a big shift nationally, and in the Los Angeles area sales are well under year-ago levels and price appreciation has cooled.

Does this mean that the decline in affordability is at an end?

``If prices go down and interest rates stay steady, then affordability will definitely go up,'' said Ahluwalia.

This is the second report this month that shows affordability eroding in California.

Last week the California Association of Realtors rolled out its new index format that tracked first-time buyer status. It showed that affordability statewide was 23 percent in the second quarter versus 30 percent in the year-ago period.

In Los Angeles County, it was 19 percent for the second quarter this year versus 27 percent in same period of 2005.

The California Realtors measured the percentage of households that can afford the median-priced home in their area.

The old California format, including both new and repeat buyers, lagged the market by two months. The last one was issued in January. It showed that in November 2005, just 14 percent of state households could afford the median-priced home, while in Los Angeles County affordability was 11 percent. Since there is a new methodology in place, the old and new indexes cannot be compared.

John Karevoll, an analyst at DataQuick Information Systems, is not sure how accurately these indexes reflect buying activity. For example, these indexes have showed affordability sinking even as sales stayed near historically high levels.

``None of the so-called affordability or opportunity indexes we've seen the past few years have been able to track what's actually been happening,'' he said.

greg.wilcox(at)dailynews.com

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