How much do I need to afford a home in California? See new income requirements
Looking to relocate in California?
Nine of the most expensive cities for homebuyers are in the Golden State, according to Consumer Affairs.
The economic research company recently researched how much homebuyers need to earn in the nation’s 200 largest metropolitan areas.
American households need to earn $120,796 a year to afford a typical home with a 10% down payment, according to the Consumer Affairs study.
However, the median household income in 2024 was $81,604.
“The income required to afford a home outpaces the median household income by 48%, pushing homeownership increasingly out of reach,” Consumer Affairs contributor Becca Blanco wrote in an April 29 article, noting that the gap has widened dramatically since 2015.
“Affordability has improved modestly ... but it’s still below normal levels,” Nadia Evangelou, principal economist and director of real estate research at the National Association of Realtors, told Consumer Affairs.
Here’s which California cites made the list:
Which California city requires the most income to buy a home?
When it comes to housing affordability, San Jose was the No. 1 most expensive city in the nation in 2026, according to the new Consumer Reports study.
You’d need to earn an annual income of $501,012 to put 10% down on a typical house in San Jose and keep monthly mortgage payments at or below 28% of your income, the company found.
With a median household income of $164,801 in 2024, San Jose residents make about 33% of what they’d need to buy a home in the Silicon Valley, according to Consumer Affairs.
As of February, the median home sale price in San Jose was about $1.5 million, roughly $1.2 million more than the nationwide median sale price of $362,412, Consumer Affairs said.
If you put 10% down when purchasing a San Jose house at that price, your monthly payment would be $11,690.
As of Wednesday, May 20, the average San Jose home was valued at about $1.4 million, according to real estate website Zillow.
What are 10 most expensive cities for homebuyers?
According to Consumer Affairs, these metro areas required the highest household incomes to afford a typical home in 2026:
- San Jose: $501,012 a year
- San Francisco: $358,090
- Santa Cruz: $354,973
- Santa Maria: $305,535
- Los Angeles: $301, 221
- San Diego: $293,618
- San Luis Obispo: $280,591
- Oxnard: $276,805
- Salinas: $262,403
- Honolulu: $255,280
All of the top 10 cities maintained their top 10 rankings from 2025, according to the company.
Did other California cities make the list?
Santa Rosa just missed the top 10, landing at No. 11 on Consumer Affairs’ list of the cities where residents must earn the most to afford homes.
In Santa Rosa, you’d need to earn $252,357 a year to afford a 10% down payment on a house and keep monthly mortgage payments at or below 28% of your income, according to the economic research company.
You’d need an annual income of $197,555 to afford a home in Sacramento, No. 21 on Consumer Affairs’ list.
Riverside was No. 22 with an annual income requirement of $197,320, and Stockton was No. 27 with a an income requirement of $182,120 a year.
How did Consumer Affairs rank metro areas?
To determine the minimum income needed to afford a typical home in each metro area, Consumer Affairs said it “applied the 28/36 rule, which recommends spending no more than 28% of gross monthly income on housing.”
The economic research company pulled data from Zillow to examine home sale prices and calculate monthly home payments.
Consumer Affairs looked at data from the U.S. Census Bureau to determine median household incomes.
