In Southern California's competitive housing market, a damaged bungalow in Monrovia is attracting surprising interest despite being only half a house. The home, partially destroyed by a giant pine tree in May, is listed for $499,999.
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Although just 645 square feet, this one-bedroom, one-bathroom property has received multiple offers due to the area’s limited housing supply. Realtor Kevin Wheeler notes that some buyers even consider adding 1,000 square feet, turning the damaged property into something much larger.
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“They were trying to buy it for $250,000 or $300,000,” Wheeler told the Times, referring to potential buyers attempting to secure the property at a lower price. “But market comparisons for similar properties in Monrovia put the value at $500,000.”
The older owners decided it was better to sell the property rather than invest in costly repairs. According to Wheeler, they simply didn't have the energy or resources to restore the home themselves. Instead, they're letting someone else take on the project of rebuilding or expanding.
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Meanwhile, California is on the brink of passing Assembly Bill 1840, a law that could offer undocumented immigrants state-backed home loans with up to $150,000 in assistance. Assemblymember Joaquin Arambula introduced the bill, aiming to expand the California Dream for All program, which helps first-time homebuyers with down payments.
This demand for homes comes when affording even a starter home in the U.S. is increasingly difficult. A new Redfin report reveals that homebuyers must earn nearly $80,000 annually to afford a typical starter home, about $20,000 more than the average household income.
According to the report, the average monthly payment for a starter home was $1,981 in July, meaning prospective homeowners had to make at least $79,252 a year.
In cities like Anaheim and Los Angeles, homebuyers must earn twice the local median income to afford a modest home. For instance, a family in Anaheim earning the median income of $122,192 would still fall short of the $251,302 required for a starter home. This affordability gap has intensified competition in cheaper markets, where homes get multiple offers. Buyers are even coming up with creative ways to stand out and try to secure a deal.
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Despite the challenges, there are some good signs. The number of starter homes for sale has increased by almost 20% compared to last year, and while mortgage rates are still high, they're starting to come down.
Home prices are still rising, but at a slower pace, giving hope to people trying to buy. Right now, even a half-destroyed house in California is considered too tempting to ignore.
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