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Breaking! Los Angeles is "Least Affordable"

[Image courtesy of Nate Berg, Planetizen]

It seems like at least once a week there is a new story ranking Least Affordable/Most Expensive/Holy-Shit-How-Can-Anyone-Afford-To-Live-Here cities. And this week is no exception. Forbes releases its list of Least Affordable cities in the US, and LA tops the list. Forbes explains its methodology:

We determined our ranking by combining the NAHB/Wells-Fargo index with our rating of home price to earnings, which measures how many years of gross income it would take to buy a home at the median sales price. The lower the number, the more affordable a house is for the median home buyer.It goes on to explain that a decade ago, only San Francisco was above 4.5. Now there are 13 cities breaking the 4.5 barrier, indicating an overheated market not just in LA, but across the country. And the news gets worse. With LA's median household income at $58,319, only 3% of recent home sales are considered affordable. At least we're pretty sure we have the highest percentage of frozen yogurt shops per capita.
· Least Affordable U.S. Real Estate Markets [Forbes]