LA is the worst place in America to buy a home — scoring an ‘F’ on a new report card
Realtor.com’s latest housing report card gave Los Angeles an F, marking it the most unaffordable and least productive city in the U.S. for new home construction. With median home prices around $1.13 million and median household income just over $91,000, the city’s typical buyer would spend more tha…
Realtor.com’s new national housing report card has placed Los Angeles at the bottom of the list, earning an embarrassing “F” for both affordability and homebuilding. The city’s score of 12 out of 100— the lowest of any of the 100 largest U.S. metro areas—reflects a brutal mismatch between home prices and household incomes, as well as a crippling lack of new construction.
What the Report Reveals About Los Angeles Housing
According to the study, the typical Los Angeles‑area home is listed for about $1,129,415, while the median household earns roughly $91,380 annually. A buyer with a 10% down payment and a 6.5% 30‑year mortgage would face a monthly payment that consumes 84.4% of their income. That figure is nearly three times the 30% threshold most economists use to gauge housing affordability.
To bring that monthly payment down to the 30% benchmark, a buyer would need to put down a staggering 68% of the purchase price—about $768,000. “Put simply, a monthly mortgage payment on the typical home in LA is not affordable to typical income‑earners,” said Realtor.com Senior Economist Joel Berner.
How the Report Was Calculated
The ranking combined two main metrics: affordability and homebuilding. Each category was weighted equally. Affordability was measured by the ratio of median home price to median household income, while homebuilding was assessed through the permit‑to‑population ratio. Los Angeles‑Long Beach scored a mere 0.9 in affordability and 23.1 in homebuilding, both far below the national average.
Any metro area with an overall score of 30 or less automatically received an F. Los Angeles’s overall score of 12 made it the most difficult place in the country to buy a home. In contrast, Des Moines, Iowa, topped the list with a combined score that placed it at the top for both affordability and new construction.
California’s Widespread Housing Woes
Los Angeles is not alone. The report found that seven of the 13 metros that earned Fs were located in California. Other California cities that flunked include Oxnard‑Thousand Oaks‑Ventura (95th), San Francisco‑Oakland (94th), San Diego (92nd), Stockton‑Lodi (91st), San Jose (90th), and Riverside (88th). Riverside’s relatively strong homebuilding score of 50.5 suggests it may see some improvement in the future.
Beyond California, the other Fs came from Providence, Rhode Island; New York‑Newark; Honolulu, Hawaii; Boston, Massachusetts; Worcester, Massachusetts; and Miami‑Fort Lauderdale.
Why the Permit‑to‑Population Ratio Matters
Los Angeles’s permit‑to‑population ratio stands at just 0.47, meaning the city is issuing fewer than half as many new permits per resident as the national average. This shortage of new construction keeps supply low, pushing prices higher and making it even harder for residents to afford homes. The study’s authors warned that supply‑side relief is unlikely to materialize soon, given the current pace of permitting.
Recent Price Trends and Future Outlook
While the report paints a grim picture, there are subtle signs of change. Los Angeles home prices have shown a slight decline from the previous year, indicating that the market may be beginning to soften. However, the underlying affordability gap remains vast, and without a significant increase in new construction, the city’s housing crisis is unlikely to resolve quickly.
Policy makers, developers, and residents will need to collaborate on solutions that increase housing supply, streamline permitting, and make financing more accessible. Until then, the city’s “F” on Realtor.com’s report card will likely stay, serving as a stark reminder of the challenges facing Los Angeles homeowners.
What Happens Next?
Realtor.com will continue to publish its annual housing report card, providing updated data on affordability and construction trends. Homebuyers, investors, and policymakers should monitor these rankings closely, as they offer a clear snapshot of where the U.S. housing market stands and where interventions may be most needed.
For now, Los Angeles remains the most difficult place in America to purchase a home, a status that underscores the urgent need for comprehensive housing reform in the city and across the state.
Why it matters
The report highlights a stark affordability crisis that threatens to keep many Los Angeles residents from homeownership and signals a broader national challenge in balancing supply and demand in major metros.
Key points
- Los Angeles earned an F on Realtor.com’s housing report card, the lowest score of any U.S. metro.
- Median home price in LA is $1.13 million while median household income is $91,380.
- Typical buyer would spend 84% of income on mortgage, far above the 30% affordability benchmark.
- Permit‑to‑population ratio in LA is 0.47, indicating a severe shortage of new construction.
- Seven of the 13 metros that flunked are in California, showing a statewide crisis.
- Des Moines, Iowa topped the list, offering a contrast to LA’s struggles.
Frequently asked questions
What factors contributed to Los Angeles receiving an F on the report card?
The city’s high median home price relative to median income and a low permit‑to‑population ratio caused a severe affordability gap and limited new construction.
How is the permit‑to‑population ratio calculated?
It measures the number of new residential permits issued per resident, comparing the local supply of new homes to the population size.
Will home prices in Los Angeles continue to rise?
While recent data shows a slight decline, the underlying affordability gap remains large, so prices are unlikely to fall significantly without a substantial increase in new construction.
