You Just Earned $85,000!

If you are one of the fortunate souls in Los Angeles to own your own home—the value of your house jumped again this past year. The Los Angeles Daily Journal writes today that the median price of a house in San Fernando Valley is now $575,000, $85,000 more than last year. (Click title to read the article...)

$85,000… That’s better than winning a Fantasy 5 California lottery ticket every year. The odds of earning wealth through homeownership are better than buying a lottery ticket.

Unfortunately, the odds of a low-income renter in Los Angeles to purchase a home, gets worse every year. Imagine if you’re homeless. You probably have more of a chance to win the SuperLotto than to buy a home.

If you were to finance a $575,000 home mortgage, your payments would be $3,355 per month. (That is if you are wealthy enough to have a down payment…) Experts say that your mortgage payment (insurance and taxes) should be no more than 28% of your monthly income. That means you need to be taking home over $12,000 per month, or $144,000 per year to be able to purchase a home!

It is just not realistic for the average worker in Los Angeles. It is virtually impossible for a person who is homeless.

And we wonder why people end up living on the streets?