A "recent" study shows that fewer and fewer Californians can afford the median California home. (I emphasize "recent" because everyone who lives here has known this for quite some time).
The median price of a California home is now $568,890. To afford a traditional mortgage you would need to earn an income of $133,800. This means that 14% of California households can qualify for a traditional loan. This of course assumes you can put down 20% of the purchase price which amounts to about $115,000. Now how many households have that much cash lying around?
How on earth do people think this can be sustained? When only 14% (if that) can afford to buy a house in an area something is wrong. What I view as the real problem is that the people this really prices out are those that are younger and just entering the job market. This will cause more and more younger families to look elsewhere when deciding where to settle. This will have serious long term effects as the working population will age and the infusion of young (and cheap) talent will erode California's economy.