SANTA ANA — A month and a half ago city officials in Santa Ana were crowing from the 8th floor of City hall about their fabulous ranking by Forbes as one of the most safest cities in the nation. On Friday, Forbes released another ranking which names Santa Ana. I’ve been digging through emails trying to find a press release from the city and I just can’t seem to find one.
Forbes has issued a list of the nation’s most overpriced cities, places where the cost of living–especially housing prices–are the highest compared to median income. Santa Ana is ranked as # 15.
According to Forbes the list was compiled by looking at housing affordability, using the Housing Opportunity Index (HOI) compiled by the National Association of Home Builders and Wells Fargo. The quarterly index weighs median prices for homes sold against median income levels to determine the percentage of local residents who could afford to buy a home.
Next they assessed the cost-of-living index created by Sperling’s Best Places, to gauge the cost of food, utilities, gas and a variety of other everyday expenses in each area. Cities that clock a cost-of-living rank above 100 represent places where these goods cost more than the national average. Since some expensive cities are balanced out with high incomes, we factored in the median salaries for residents with a BA degree or higher to see just how far a paycheck actually stretches in each of these cities, using data from Payscale.com. Last, they included local unemployment rates collected from Moody’s Economy.com and the Bureau of Labor Statistics.
From the Forbes article on the rankings:
Overall, Los Angeles took the top spot on our list this year (eight other California cities were also on the ranking). In LA and Santa Ana (#15) only 43% to 45% of residents can afford to own homes and daily livings costs closely trail New York’s in terms of priceyness. Up north, three Silicon Valley cities make our list: San Jose at No. 8, Oakland at No. 14, and San Francisco at No. 19.
“Coastal state cities are high-amenity cities and people are willing to pay more for those amenities,” explains Robert Helsley, a professor at the University of California, Berkeley’s Haas School of Business, specializing in real estate development and urban economics.
So congratulations Santa Ana, you’ve made it on to another list from Forbes.