Nov 28 2017 5018 1

Dated: 11/28/2017

Views: 43

Low Interest Rates Have a High Impact on Your Purchasing Power

According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 3.92%, which is still near record lows in comparison to recent history!

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows what impact rising interest rates would have if you planned to purchase a home within the national median price range, and planned to keep your principal and interest payments between $1,850-$1,900 a month.

Low Interest Rates Have a High Impact on Your Purchasing Power | MyKCM

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, $10,000). Experts predict that mortgage rates will be closer to 5% by this time next year.

Act now to get the most house for your hard-earned money.

Blog author image

Jeri Patrick

In today’s complex and difficult real estate market you need a professionals who will do whatever it takes to market and sell your home. Jeri Patrick has a team with an established history of succes....

Want to Advertise on this Site?

Latest Blog Posts

Apr 20 2018 5018 1

Home Buying Myths Slayed [INFOGRAPHIC]Some Highlights: The average down payment for first-time homebuyers is only 6%! Despite mortgage interest rates being over 4%, rates are still below

Read More

Apr 18 2018 5018 1

How Much Do You Need to Make to Buy a Home in Your State? It’s no mystery that cost of living varies drastically depending on where you live, so a new study by 

Read More

Apr 17 2018 5018 1

Tuesday!

Read More

Apr 16 2018 5018 1

Mortgage Interest Rates Have Begun to Level Off Whether you are a buyer searching for your first home, or a homeowner looking to move up to your next home, you should pay

Read More