Voters not enamored with local taxes
The California Taxpayer’s Association (CalTax) reports early returns from this week’s local elections suggest affordability and cost-of-living concerns remain a top priority for California’s electorate. This sentiment is demonstrated by opposition to new taxes and bonds. CalTax reports that less than half (42 out of 95) of the local ballot measures are likely to pass, representing approximately 44 percent approval statewide and $271 million in tax increases, cumulatively.
Of the 53 remaining measures, 32 appear to have failed, and 21 are too close to call based on the early results posted by county elections officials. Highlights include failure of Measure A, a vacant property tax proposal in the city of San Diego, which appears to be failing with only 42.31% yes votes. Measure E, a parcel tax in the city of Oakland, also appears headed for defeat with only 46 percent yes votes.
Results are preliminary as election officials continue to tabulate.
Buyers Now Pay More in Mortgage Interest Than Their Home Costs
Over 30 years, the typical home buyer pays $736,260 back to the lender on a $322,560 loan for the median-priced home, more than twice what they originally borrowed. A buyer who purchases the median-priced U.S. home today with 20% down will pay $413,700 in interest over a 30-year mortgage at the current 6.53% rate, according to a new report from Best Interest Financial and Clever Real Estate, a St. Louis-based real estate company.
That is $10,500 more than the home itself costs. Put another way, buyers will pay 102.6% of the home’s price again in interest, a ratio that recently crossed 100% for the first time since September 2025. At 2021’s average rate of 2.96%, today’s median home would cost $692 less a month, $8,306 less a year, or a staggering $249,188 less in interest over the life of the loan.
On the other hand, if today’s rate climbed a single percentage point to 7.53%, the typical buyer would pay $78,066 more in lifetime interest. Putting down the FHA minimum of 3.5% instead of 20% adds even more, an extra $85,326 over the life of the loan.
Choosing a 15-year mortgage at today’s 5.87% rate would save $250,378 over a 30-year loan, though it pushes the monthly payment up by $654. Although loan decisions make a big impact, location matters just as much. Every metro studied shares the same 102.6% ratio but not the same dollar figure.
California claims five of the six most interest-burdened metros, while Ohio sits at the opposite extreme, home to four of the 10 metros where buyers pay the least in lifetime interest. The metros with the highest lifetime interest are: San Jose ($1,718,620), San Francisco ($1,231,250), Los Angeles ($1,077,344),San Diego ($992,695), and Oxnard ($941,650)
Luxury Housing Market Surges While Middle Buyers Stay Sidelined
Luxury homebuyers are continuing to drive housing activity despite elevated mortgage rates, highlighting a growing divide between affluent borrowers and mainstream buyers still struggling with affordability pressures. New data from Redfin shows pending sales of luxury homes rose 4.3% year over year during the three months ending April 30 – the largest increase since January 2025. The report suggests that while lower mortgage rates earlier this spring helped improve buyer demand broadly, wealthier borrowers remain far less sensitive to financing costs than middle-market consumers facing stretched monthly payment calculations.
For mortgage professionals, the data is another sign that whatever recovery is taking shape in housing is happening unevenly. Affluent borrowers with stock-market wealth, large down payments, and cash reserves are continuing to transact, while many first-time and middle-income buyers remain sidelined by affordability pressures and elevated mortgage rates.
The luxury market’s strength was especially pronounced in tech-heavy regions benefiting from the artificial intelligence boom. San Francisco posted the nation’s largest increase in luxury pending sales, surging 48.4% year over year in April – the metro’s biggest jump since June 2021.
At the same time, more affluent homeowners appear increasingly willing to list properties despite higher borrowing costs. San Francisco again stood out, posting a 17.7% increase in luxury new listings – the second-largest gain among the metros Redfin analyzed. The numbers suggest some high-end homeowners may finally be moving beyond the “lock-in effect” that has constrained housing inventory since rates surged in 2022 and 2023. Unlike many middle-income homeowners reluctant to give up ultra-low pandemic-era mortgage rates, affluent sellers may have more flexibility to absorb today’s financing environment.
In other words, housing demand hasn’t disappeared – but much of the remaining momentum is coming from borrowers who can largely ignore the mortgage-rate environment altogether.
Narrower ‘service-animal’ rules could trigger evictions
The Department of Housing and Urban Development (HUD) plans to update its policy concerning federal requirements that landlords accept tenants with disabilities having service animals or emotional support animals in otherwise animal-free properties. Under the new regulations described in a memo issued by HUD, emotional support animals would no longer qualify for exemptions in animal-free residences. Landlords would still be required to accept service animals, but the requirements for service animals would be made stricter. This change will not affect California.
The changes represent a narrowing of enforcement of a provision of the Fair Housing Act that exempts “assistance animals” from being excluded from no-pet buildings or subject to pet fees from landlords. Note, however, that some states have legal protections above and beyond federal regulations, including California. Nothing about California law or fair housing regulations have changed, and REALTORS® and housing providers still need to follow California’s rules regarding support animals. For more information, go to on.car.org/emotsuppanimals.