California housing costs at 7-year low, relatively speaking

“Survey says” looks at various rankings and scorecards judging geographic locations while noting these grades are best seen as a mix of artful interpretation and data.

Buzz: California’s housing costs – compared with other states – were at a seven-year low in 2022.

Source: My trusty spreadsheet looked at a curious cost-of-living yardstick – the federal government’s annual “price parity” report that puts key consumer expenses into a national perspective between the 50 states and the District of Columbia. We focused on the recently released data for 2002 and compared those stats with the last time California had a better housing cost number (2015). 

Topline

California housing costs ran 60% above the US norm in 2022, by this math. That’s the smallest premium since 2015’s 58%.

So you see, I’m not saying the cost of putting a roof over your head in California has become any bargain. I’m only highlighting a sliver of calm in California’s affordability mess.

Golden State housing expenses still rank second-priciest in the US. Only DC was higher by this measurement, at 77% above average. New Jersey was No. 3 at 36%.

Now, if you’re looking for a housing-cost utopia, try West Virginia (46% below average), Arkansas (44% below) or Mississippi (43% below).

Details

The report highlights how some of the nation’s fast-growth economies are now suffering from what were once seen as exclusively coastal challenges: soaring housing costs.

California’s relative housing costs are up by 2 percentage points in seven years – but that’s only the No. 17 gain among the states. Ponder the bigger jumps since 2015.

Idaho is up 13.5 points, though its housing is still 12% cheaper than the US average. Nevada rose 13 points to become 12% above average. Arizona increased 12.5 points to 6% above average. Those are some of the nation’s fastest-growing economies – and common destinations for relocating Golden Staters.

And California’s arch-rivals? Florida was No. 7 with a 7-point jump to 16% above average. Texas was No. 14, up 3 points to 3% below average.

Yes, housing in some states got relatively much cheaper. Costs in Hawaii were off 22 percentage points but were still 32% above average. Alaska fell 18 points to 3% below average. And Connecticut was off 13 points to 19% above average.

Caveats

California’s overall cost of living remains lofty, by this math: It’s second-highest at 12% above average behind only DC’s 13%. Hawaii’s No. 3 at 11%.

The bargains were found in Arkansas and Mississippi where such costs were 13% less than the typical state. Texas was No. 23 at 2% below average, while Florida was No. 14 at 2% above average.

California’s overall cost-of-living premium rose over seven years – up 1.8 percentage points, the ninth-biggest gain.

Why did the price of California life rise despite the housing improvement? Blame utilities!

Those California costs were fourth-highest nationally, 47% above average in 2022, topped by only Hawaii at 101%, Massachusetts at 51% and New Hampshire at 48%.

The lows were in Idaho, at 34% below average, and Utah at 29% below. Texas was No. 29 at 11% below and Florida was No. 20 at 6% below.

Worse, utility bills soared in the Golden State. The California utility premium jumped by 18 percentage points over seven years, the No. 3 increase among the states.

Bottom line

Why do folks leave California?

Well, ponder the five states that got the most ex-Californians in 2022 and their cost-of-living advantage, according to the price parity equation …

Texas: A relocation would save a Californian 39% on housing and 13% overall.

Arizona: Saves 34% on housing and 11% overall.

Florida: Saves 27% on housing and 9% overall.

Washington: Saves 20% on housing and 2% overall.

Nevada: Saves 30% on housing and 14% overall.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

Source: Orange County Register