With a series of programs recently launched intending to boost home ownership in the state, a newly released study analyzing U.S. Census Bureau data shows California with the lowest rate in the nation.
West Virginia and Vermont accompany Maine at the top of the scale, with the three separated by a fraction of a percentage point, according to the study emailed to The Epoch Times.
At the other end of the spectrum, Hawaii and New York rank as the second and third worst homeownership rates, respectively.
“It’s very interesting how among the states with the highest rate and those with the lowest rate, the values are very similar,” Tony Mariotti, founder and CEO of Ruby Home, stated in the study’s press release. “This however cannot be said about the values at the two poles of the list, as Maine on one side and California on the other have a drastic gap between them.”
Census Bureau data for 2022 shows 55.3 percent of homes are owned in California, slightly higher than the 53.9 percent in New York in 2022, with the two states ranking the lowest in the country. West Virginia’s 78.6 percent places it first, and Maine and Delaware tied for second with 74.9 percent.
These numbers differ from the recent study due to calculation methods. The formula utilized by Ruby Home takes the number of owner-occupied homes and divides by population, while the census numbers divide the number of owner-occupied homes by the number of occupied households.
Experts suggest low ownership rates in California can be attributed to a higher cost of living and the highest median home price in the nation, with migration out of the state continuing to increase due to these economic difficulties.
“The trend will continue, and California will continue to get smaller,” Lee Ohanian, professor of economics at the University of California–Los Angeles, told The Epoch Times. “Those in the middle-income categories will move because they make too much for assistance, but not enough to buy a home.”
Census data shows household income averaged just over $84,000 in California as of 2021, with a national median of nearly $71,000.
Taking cost of living into account, California ranked second highest in overall poverty, with a rate of 15.4 percent as of 2022, according to Census Bureau figures. Only the District of Columbia scored worse, at 16.5 percent.
While a $15.50 minimum wage in the Golden State is significantly higher than the $7.25 federal limit, increased wages are not enough to cover the inflated cost of home prices and commodities, according to Ohanian.
“Salaries are higher in the state on average than the rest of the country, but they don’t come close to compensating the median worker for the additional cost of living,” he said.
The median home sale price in California was over $744,000 in March 2023, down nearly 8 percent from the same time in 2022, according to Redfin, a Seattle-based residential real estate brokerage.
In efforts to boost California’s homeownership statistics, the Dream for All home loan program—passed in 2022—proposes a $10 billion investment over 10 years to assist new home buyers with down payment loans in exchange for a share in the home’s appreciation.
The state budget allocated $300 million for the program in 2023, with the amount depleted in less than 12 days due to high demand, according to the California Housing Agency.
