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When it comes to sheer size, importance, and beautiful weather, California is at or near the very top for all three categories.
The Golden State is the most populous state and the third largest in the United States. California’s most populated city, Los Angeles, is the second largest city in the nation.
If it were a separate country, California would have the 6th largest economy in the world. The San Francisco Bay Area has the nation’s highest median household income and is home to corporate giants like Apple and Chevron.
Let us not forget about the beautiful weather and scenery. Even in winter, most places in California rarely dip below 50 degrees Fahrenheit. The Golden State is home to beautiful beaches, breathtaking mountain ranges, and awe-inspiring Redwood forests.
In summation, California is a great place to live. You can be around the hustle of major cities like Los Angeles or San Diego. There are plenty of career opportunities thanks to the massive economy that is home to many prestigious companies. Finally, you would be hard-pressed to find a state that offers up more natural beauty.
But, California is a massive state with more than a thousand towns and cities. Choosing a particular community in California to call your home can be a stressful task.
That is why LendEDU has put together a list of the 250 best places in California for homebuyers. We used licensed data to evaluate over 1,000 California towns and cities based on parameters deemed important to house-hunters.
The following three parameters were used:
- Home Income to Home Value Ratio Score (40 points, listed in table as Value)
- Five-Year Population Forecast Score (40 points, listed in table as Population)
- Five-Year Income Forecast Score (20 points, listed in table as Income)
These particular parameters were chosen because they can greatly impact the investment a homeowner makes. You want good value on your home relative to your income. And, you want to live in a community that is projected to see growth in both population and income so that the demand to live in that neighborhood goes up, which in turn raises your home value.
The 250 California towns featured in the list below are the best places in the whole state for purchasing a home that will also turn into a profitable investment.
Ranking the 250 Best Places in California to Buy a Home
LendEDU has licensed all data used in this study from Onboard Informatics, a data company. All data was broken down by ZIP Code, which was then simplified down to town and city names. If a large city, like Los Angeles, had multiple ZIP codes then the ZIP codes and their respective statistics were averaged together and weighted by population. LendEDU’s original list featured over 1,000 towns and cities in the state of California. A population cutoff was set at 3,500, meaning any town or city with a population below 3,500 was eliminated from further analysis.
Home Income to Value Ratio Score (40 points maximum)
The first parameter was listed as “Home Income to Home Value Ratio Score.” This parameter was scored by dividing the median household income by the median household value. The value ratios were then ranked against one another on a percent scale from 0 to 100. Each individual percent rank was multiplied by its weight to produce the value score. The maximum possible score was 40 points. This parameter represented the value a potential resident could expect from a typical home purchase in a given town.
Five-Year Population Forecast Score (40 points maximum)
The second parameter we judged was named the “Five-Year Population Forecast Score,” and was calculated by using the current population and five-year projected population figures. The licensed dataset had the projected population growth in a respective town over the next five years. A percent change equation was used to find the percent increase or decrease in population over the next five years. Each individual percent change was ranked on a percent scale from 0 to 100 against the entire field. Then, each percent rank was multiplied by its weight of 40 percent to produce the Five-Year Population Forecast Score. The greatest point total possible was 40 points.
Five-Year Income Forecast Score (20 points maximum)
LendEDU’s third parameter was dubbed the “Five-Year Income Forecast Score.” To find this score, we used the median household income and the five-year median household income projection. Similar to Onboard Informatics’ population projections, the dataset presented the projected growth in income over the next five years in a specific town. A percent change equation was used to determine the percent increase or decrease in income over the next five years for each individual city and town featured in this study. The values were then ranked against each other on a percent scale from 0 to 100. Each individual percent rank was multiplied by its weight (20 percent) to produce the Five-Year Income Forecast Score. The maximum value for this score was 20 points.
Every single town and city in California was assigned a numeric score for each parameter. The parameter scores for a given town were summed together to get the final score. A score closer to 100 meant that town was better for homebuyers. The 250 cities and towns that posted the highest final scores were the ones included in the report.
See more of LendEDU’s Research
Author: Mike Brown