Online Extra: The Price of Luxury
HOW WE CREATED THE INDEX
The usual affordability index tells whether a midmarket house is within the budget of a middle-income family. BusinessWeek's index, based on house-price data from Fidelity National Financial Inc., looks at the top 10% of house prices and incomes. An index value of 100 means that given prevailing mortgage rates, a family earning just enough to be in the top 10% of incomes in a metro area should be able to afford a house that is just in the top 10% of prices. Note: This is an extended, online-only version of the table in the Dec. 27, 2004 issue of BusinessWeek
For information on housing prices in cities all around the U.S., visit the Office of Federal Housing Enterprise Oversight Web site.
|Luxury home price||affordability index|
|Los Angeles-Long Beach||870,000||72|
|Orange County CA||1,150,000||66|
* Third quarter 2004, in thousands of dollars
Data: Fidelity National Financial Inc., Housing & Urban Development Dept.