1 in 4 OC Homes Are Mortgage Free

Imagine not having to pay any rent or make mortgage any payments.

In Orange County, almost one out of every four homes are in that boat because their owners don’t have a mortgage, according to U.S. Census data released Thursday.

We’re talking 100% equity. Free and clear. Housing costs as low as $500 a month.

And the number is growing.

The countywide percentage of mortgage-free homes has been rising during the past seven years, no doubt because of the higher proportion of all-cash homebuyers who surfaced in the wake of the credit crunch.

For example, the proportion of mortgage-free homes in O.C. increased from 21.6% in 2004 to 24% in 2009 and 2010, census figures show.

And in Westminster, nearly 37% of homeowners — more than one out of every three owners — don’t have a mortgage, census figures show. That’s the highest proportion of free-and-clear homeowners among the dozen O.C. cities for which mortgage data was available.

The city with the lowest proportion of homeowners without a mortgage: Irvine, where fewer than 17% of the homes are owned free and clear, leaving the other 83% stuck paying off home loans for decades to come.

It may not be a coincidence, since Irvine is relatively pricey compared to Westminster. The median price of an Irvine home averaged nearly $556,000 in August vs. Westminster’s median home price of less than $403,000, according to DataQuick.

The latest numbers are part of the American Community Survey for 2010. The report shows further:

-Of the 584,314 owner-occupied homes in the county, 444,114 have a mortgage, while 140,200 are mortgage-free.
-Among homes with a mortgage, median monthly housing costs totaled $2,597.
-Among homes without a mortgage, median monthly housing costs totaled $478.
-Among homes with a mortgage, 41.6% of households paid 35% or more of their monthly income on housing costs.
-Among homes without a mortgage, 12.9% of households paid 35% or more on monthly housing expenses.

Other cities with above-average proportions of mortgage-free homes:

-Fullerton: 27.8%
-Huntington Beach: 27.0%
-Costa Mesa: 26.4%

Other cities with below-average numbers of mortgage-free homes:

-Lake Forest: 18.8%
-Mission Viejo: 19.8%
-Orange: 22.0%

The margin of error ranges from 2.6% in Anaheim to 6.3% in Westminster — although that city remains at the top of the heap, even if the numbers are 6% off.