Compared to other states, CA has uber-high median home prices — coupled with much smaller lots and smaller houses

Richard Rider, Chairman, San Diego Tax Fighters Richard Rider, Chairman, San Diego Tax Fighters 19 Comments

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As everyone knows, buying a home in California is MUCH more expensive than buying a home in almost all the other states. Generally we compare states using the “median home value.” According to Zillow, the July 2020 median home value in the U.S. is $248,857. The CA median home value is $578,857. BTW, the median home value in our San Diego County is $628,519.

https://www.zillow.com/san-diego-county-ca/home-values/

 

CA has 11% of all the homes in America. If we take these CA homes out of the national average, then the median home price of the other 49 states is only $208,143. Thus the median CA home costs 2.78 times more than a median home in the other 49 states.

But it’s actually worse than that. There’s two other factors to consider that seldom are mentioned.

1. The size of the lot.
Below is an EXCELLENT graphic comparing the average home lot size by state. It uses the NET lot — full lot minus the house square footage. While the data is 9 years old, it’s reasonable to expect the state averages to remain roughly the same — especially compared to each other.

Not surprisingly, in CA we have much smaller lots than most states. Indeed, only Nevada has smaller average lots — probably because of the high percent of townhome/condos in the Las Vegas/Henderson area.

https://www.homeadvisor.com/r/average-yard-size-by-state/

How much smaller are CA lots? The average California home lot (5,575 square feet — SF) is about HALF the national average (10,871 SF). But remember, CA has about 11% of the nation’s homes — and those CA homes are part of the nation average. Take out the CA homes, and we find that the average lot in other 49 states is 11,526 SF).

2. The size of the house.
From the same source, we can find the average home square footage in each state. Not surprisingly, CA has small homes (1,625 SF) compared to the national average (1,761 SF). There are only four states with smaller average homes:

Ohio            1,620 SF (essentially tied with CA’s 1,625 SF)

Iowa            1,550 SF

Michigan    1,530 SF

Hawaii        1,308 SF
 
HOMEADVISOR.COM

How big is the average lawn?

In the United States, residential lawns average 10,871 square feet (or roughly a quarter of an acre). This depends greatly on location.

For instance, the average lawn size in California is 5,575 square feet. This is calculated by taking the average lot size in CA, or 7,200 square feet, and subtracting the average home size, 1,625 square feet. Meanwhile, locals in Montana get more than an acre and a half of yard space. That’s 71,576 square feet!

See how your state’s average backyard size compares to the rest of the United States!

NOTE: Click to enlarge this graphic.

 

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Comments 19

  1. A Ferrari is much more expensive than an average car.

    The Ferrari also gets worse gas mileage than an average car.

    It also costs way more to insure maintain, and repair.

    Ferrari must be terrible cars, huh?

    A home is about more than four walls. Location, location, location. The market sets the value of both cars and homes, not stats. This is a competitive market where successful people want to live.

  2. Post
    Author

    Soooo, you think is that only people who can afford a Ferrari should be able to buy a home in California.

    Got it. Thanks.

    You don’t think government has anything to do with the SHORTAGE of homes, or the high prices.

    “Encinitas Dad,” you present a perfect example of coastal elitist thinking: “Screw the middle people. I’ve got mine.”

  3. Richard,

    Do you understand what the word “median” means? Let me help: A median price means half cost more but also half cost less.

  4. This is refreshing.

    Rider is advocating for government regulation to manipulate the price of housing so the proletariat can live in Rancho Santa Fe.

    You convinced me. I switch sides.

    How can we work together to make it happen?

  5. Hypocrisy, do you understand that the median price and land size is the same in ALL states? All the other median figures mean the same thing — half more, half less.

    In other words, what’s your point?

  6. Encinitas Dad – your comment helps reveal that an otherwise bright person can be an unthinking progressive drone. I’m not interested in getting the proletariat to live in Rancho Santa Fe. But I AM interested in them able to buy homes in CALIFORNIA — something an elitist like yourself opposes.

    The way to bring prices down is to allow — even ENCOURAGE — the building of more houses, condos and apartments. Regulating prices and rents is how YOUR side runs things — I’m genuinely surprised that you didn’t know that.

    FACT: Texas and most other states have NO “housing crisis,” they encourage — more building.
    Here’s a sobering graphic comparing the CITY of Houston, TX with the entire STATE of California.
    http://www.aei.org/publication/monday-afternoon-linkage-4/

    What it shows is that for much of this past decade, more permits for single-family homes have been issued in the city of Houston annually than in the entire state of California from 2011 through March 2015 (133,462 vs. 132,915). The result is that the median Texas home costs ONE-THIRD what the median California home costs. And here’s the kicker: 17 states have lower home prices than Texas!

    In addition, cutting the MASSIVE housing impact and permit fees we pay in (massive only in California) would greatly help. The average “impact” fees in CA for building the median single-family residence ($548,000 – May, 2019) varied from 6% ($32,880) to 18% ($98,640) per home, about double the fees charged by the next most expensive state and more than TRIPLE the norm among jurisdictions that levy such fees (many governments east of the Sierras charge little or no fees). The fee is part of the purchase price, so buyers pay an annual property tax on the fee!
    https://ternercenter.berkeley.edu/blog/it-all-adds-up-the-cost-of-housing-development-fees-in-seven-california-cit

    Supply and demand is something you’ve never been able to comprehend. Central planning is your mantra. Thanks for the demonstration.

  7. Means there are plenty of homes for the “middle people” as you call them.

    What you fail to mention is that the easiest path to wealth is through home ownership and homes in California appreciate in value faster and more than almost anywhere else.

  8. “Location, location, location. The market sets the value of both cars and homes, not stats. This is a competitive market where successful people want to live.”

    There are no “market forces” at work here. California (in general) and more specifically San Diego is a rent-seekers paradise. Local governments have been rigging the game, in favor of property owners, for close to 4 decades. By virtually halting housing permits since the recession, they have guaranteed a permanent serf class.

    I make a living in the industry but I wont delude myself into thinking that there is any special wisdom to be aligned with the crony capitalists.

  9. Brian,

    So the game is “rigged” yet you are comfortable with the fact that you “make a living in the industry.” Where are the ethics in that? Would you work for a casino if you knew they used loaded dice?

  10. HQ,
    BS comparison and you know it. Brian was referring to government rigging the situation. He was not referring to his own industry rigging it, or his own business cheating in any way.

    If government were rigging the gaming industry in any way to benefit casino development, that doesn’t mean the casino itself is cheating with loaded dice.

  11. “So the game is “rigged” yet you are comfortable with the fact that you “make a living in the industry.” Where are the ethics in that”

    It’s simple agency law; I work for the people who hire me for my advice. Is the rigged game fair for every Californian? Absolutely not and it’s bad public policy but I don’t work for “every Californian”.

    If you are interested in making money in Coastal California real estate , I am a great choice because I know how the game is rigged.

    Thanks for the free advertisement, HQ

  12. Richard,

    Is this right?

    1.) Geography A (California) has a significantly higher cost of housing relative to Geography B (rest of the lower 48).

    2.) Geography A also has more restrictions on permitting and development than Geography B.

    3.) Proposed solution: Geography A should relax permitting and development standards to stimulate more housing production, relieving the supply constraint until the cost of housing approaches that of Geography B.

    Is that right?

    If so, and if high housing cost is really the problem, then why not focus on the most acute crux of the problem by applying the same logic to Geo A (Rancho Santa Fe) and Geo B (rest of SD county)?

    Or, can we apply the same race to the bottom method to Geo A (USA) and Geo B (rest of world)? I’ll wager if we relax our building standards nationwide, one day we may achieve a cost (and quality) of housing similar to a Brazilian favela.

  13. “If so, and if high housing cost is really the problem, then why not focus on the most acute crux of the problem by applying the same logic to Geo A (Rancho Santa Fe) and Geo B (rest of SD county)?”

    More units have been built in Rancho Santa Fe than most other coastal cities in the past 10 years. That’s with a number of master-planned communities with voluntary deed restrictions.

    That MAY be because they have a General Plan which was adopted (and followed) by the Board of Supervisors rather than local governments (who have chosen not to follow their General Plans)

    This is a tough issue. Nobody wants density housing in the backyard but few people have a solution for their kids and grandkids moving to Austin, Nashville, and Boise

  14. T.A,

    I call BS right back at you. The only reason the government would rig the gaming industry to support casino development is because the casino developers pump big money into candidates for government . Likewise, Brian’s industry (not necessarily Brian) pumps big money into candidates too! And no, I do not believe it is ethical to complain about the lack of fairness in the system while exploiting that same lack of fairness to line your own pockets. See Brian thanking me for the free advertisement.

  15. “I do not believe it is ethical to complain about the lack of fairness in the system while exploiting that same lack of fairness to line your own pockets”

    See, now I have to call BS. You intentionally missed the opening line of my comment:

    “It’s simple agency law; I work for the people who hire me for my advice.”

    I am not “lining my pockets”, I am earning a fee for my expertise at helping investors negotiate what is not a free market. The fact that I am extraordinarily good at explaining this to clients gives them an advantage my competitors can’t offer.

  16. So, according to HQ, it’s unethical for ANYONE to work in an industry that deals with government policies which have benefitted one group of people at the expense of others.

    Ok. Got it.

  17. T.A. and Brian,

    You can take advantage of unethical policies to make a buck or you can work to change those policies.

    I’ll let you both tell me that you can do both and still keep your integrity and I will let you believe that and leave it as the last word.

  18. This particular T.A. (only because there may be more than one) has worked for years to change existing government policies for the better, while also advising clients on both how to navigate the existing policies and how they can advocate for a change in those policies.

  19. HQ–

    Most every industry in this country (including yours) is filled with rent seekers; you know that. It’s possible to advocate for better public policy while performing a fiduciary duty. I am doing that right now…. in front of my clients.

    But you know that because you are smart. You are following this line of attack because you don’t like me personally. Please double down now with the ad hominem attacks — you make me look even smarter in front of my clients.

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