California housing affordability holds at 19% as mortgage rates climb
The effective 30-year fixed mortgage rate rose to 6.80%, up from 6.54% in Q2 2026 and 6.67% a year ago, its highest since the second quarter of 2025.
Buyers needed a minimum annual income of $228,000 to cover a monthly payment of $5,700, including principal, interest, taxes, and insurance. California’s monthly housing cost remained more than double the national average of $2,760.
CAR had forecast meaningful rate-driven affordability gains in 2026. The reversal of that trend leaves the minimum qualifying income above $200,000 for the 15th time in the past 16 quarters.
Rates reverse a four-quarter decline
“Mortgage rates are expected to continue declining in 2026, but the decrease is unlikely to be dramatic,” Jordan Levine, CAR senior vice president and chief economist in Sacramento, told Mortgage Professional America in late 2025.
