{"id":3464,"date":"2021-04-06T09:46:15","date_gmt":"2021-04-06T16:46:15","guid":{"rendered":"http:\/\/skyrisere.com\/listings\/?p=3464"},"modified":"2021-04-06T09:46:15","modified_gmt":"2021-04-06T16:46:15","slug":"how-a-change-in-mortgage-rate-impacts-your-homebuying-budget","status":"publish","type":"post","link":"https:\/\/skyrisere.com\/listings\/2021\/04\/06\/how-a-change-in-mortgage-rate-impacts-your-homebuying-budget\/","title":{"rendered":"How a Change in Mortgage Rate Impacts Your Homebuying Budget"},"content":{"rendered":"<p>Mortgage rates are on the  <a href=\"https:\/\/www.keepingcurrentmatters.com\/2021\/03\/09\/how-upset-should-you-be-about-3-mortgage-rates\/\">rise<\/a>  this year, but they\u2019re still incredibly low compared to the historic  <a href=\"https:\/\/www.keepingcurrentmatters.com\/2021\/02\/19\/home-mortgage-rates-by-decade-infographic\/\">average<\/a> . However, anytime there\u2019s a change in the mortgage rate, it affects what you can afford to borrow when you\u2019re buying a home. <\/p>\n<p>As Sam Khater, <i>Chief Economist<\/i> at <i>Freddie Mac<\/i>,  <a href=\"https:\/\/freddiemac.gcs-web.com\/node\/22396\/pdf\">shares<\/a> :<\/p>\n<blockquote>\n<p>\u201cSince January, mortgage rates have increased half a percentage point from historic lows and home prices have risen, leaving potential homebuyers with less purchasing power.\u201d (See graph below):<\/p>\n<\/blockquote>\n<p><a href=\"https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/E095698C-4627-412D-B879-383126D6ACF8.png\"><img fetchpriority=\"high\" decoding=\"async\" data-id=\"3465\"  src=\"https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/E095698C-4627-412D-B879-383126D6ACF8.png\" alt=\"\" width=\"1000\" height=\"750\" class=\"aligncenter size-full wp-image-3465\" srcset=\"https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/E095698C-4627-412D-B879-383126D6ACF8.png 1000w, https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/E095698C-4627-412D-B879-383126D6ACF8-300x225.png 300w, https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/E095698C-4627-412D-B879-383126D6ACF8-768x576.png 768w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><\/a><\/p>\n<p>When buying a home, it\u2019s important to determine a monthly budget so you can plan for and understand what you can  <a href=\"https:\/\/www.keepingcurrentmatters.com\/2021\/02\/11\/47-of-new-buyers-surprised-by-how-affordable-homes-are-today\/\">afford<\/a> . However, when you need to stick to your budget, even a small increase in the mortgage rate can make a big difference.<\/p>\n<p>According to the <i>National Association of Realtors<\/i> (NAR), today, the median existing-home price is  <a href=\"https:\/\/www.nar.realtor\/newsroom\/existing-home-sales-descend-6-6-in-february\">$313,000<\/a> . Using $300,000 as a simple number close to the median  <a href=\"https:\/\/www.keepingcurrentmatters.com\/2021\/03\/24\/why-you-should-think-about-listing-prices-like-an-auctions-reserve-price\/\">price<\/a> , here\u2019s an example of how a change in mortgage rate impacts your monthly principal and interest payments on a home.<\/p>\n<p><a href=\"https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/8DBD131E-8311-4A65-B848-EA3BFA20EF57.png\"><img decoding=\"async\" data-id=\"3466\"  src=\"https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/8DBD131E-8311-4A65-B848-EA3BFA20EF57.png\" alt=\"\" width=\"1000\" height=\"750\" class=\"aligncenter size-full wp-image-3466\" srcset=\"https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/8DBD131E-8311-4A65-B848-EA3BFA20EF57.png 1000w, https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/8DBD131E-8311-4A65-B848-EA3BFA20EF57-300x225.png 300w, https:\/\/skyrisere.com\/listings\/wp-content\/uploads\/2021\/04\/8DBD131E-8311-4A65-B848-EA3BFA20EF57-768x576.png 768w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><\/a><\/p>\n<p>If, for example, you\u2019re getting ready to buy a home and know your budget allows for a monthly payment of $1200-1250 (marked in gray on the table above), every time the mortgage rate <b>increases<\/b>, the loan amount has to <b>decrease<\/b> to keep your monthly cost in range. This means you may have to look for lower-priced homes as mortgage rates go up if you want to be able to maintain your budget.<\/p>\n<p>In essence, it\u2019s ideal to close on a home loan when mortgage rates are low, so you can afford to borrow more money. This gives you more purchasing power when you buy a home. <\/p>\n<p>Mark Fleming, <i>Chief Economist<\/i> at <i>First American<\/i>,  <a href=\"https:\/\/blog.firstam.com\/economics\/the-good-the-bad-and-the-maybe-ahead-of-spring-home-buying\">explains<\/a> :<\/p>\n<blockquote>\n<p>\u201cMonthly payments have remained manageable despite soaring home prices because of<b>*low mortgage rates<\/b>*. In fact, monthly payments remain below the $1,250 to $1,260 range that we saw in both fall 2018 and spring 2019, but they are on track to hit that level this spring.<\/p>\n<p>Although they remain low, <b>mortgage rates have begun to increase and are expected to rise further later in the year<\/b>, thus affordability will test buyer demand in the months ahead and likely help slow the pace of price growth.\u201d<\/p>\n<\/blockquote>\n<p>Today\u2019s mortgage rates are still very low, but experts  <a href=\"https:\/\/www.keepingcurrentmatters.com\/2021\/02\/18\/will-low-mortgage-rates-continue-through-2021\/\">project<\/a>  they\u2019ll continue to rise modestly this year. As a result, every moment counts for homebuyers who want to secure the lowest mortgage rate they can in order to be able to afford the home of their dreams.<\/p>\n<h2 id=\"Bottom Line\">Bottom Line<\/h2>\n<p>Thanks to low mortgage rates, the spring housing market\u2019s in bloom for buyers \u2013 but these favorable conditions may not last for long. Contact <i>Skyrise Real Estate Group<\/i> today to start the homebuying process while your purchasing power is still holding strong.<\/p>\n ","protected":false},"excerpt":{"rendered":"<p>Mortgage rates are on the rise this year, but they\u2019re still incredibly low compared to the historic average . However, anytime there\u2019s a change in the mortgage rate, it affects what you can afford to borrow when you\u2019re buying a home. As Sam Khater, Chief Economist at Freddie Mac, shares : \u201cSince January, mortgage rates [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":3467,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"ocean_post_layout":"","ocean_both_sidebars_style":"","ocean_both_sidebars_content_width":0,"ocean_both_sidebars_sidebars_width":0,"ocean_sidebar":"0","ocean_second_sidebar":"0","ocean_disable_margins":"enable","ocean_add_body_class":"","ocean_shortcode_before_top_bar":"","ocean_shortcode_after_top_bar":"","ocean_shortcode_before_header":"","ocean_shortcode_after_header":"","ocean_has_shortcode":"","ocean_shortcode_after_title":"","ocean_shortcode_before_footer_widgets":"","ocean_shortcode_after_footer_widgets":"","ocean_shortcode_before_footer_bottom":"","ocean_shortcode_after_footer_bottom":"","ocean_display_top_bar":"default","ocean_display_header":"default","ocean_header_style":"","ocean_center_header_left_menu":"0","ocean_custom_header_template":"0","ocean_custom_logo":0,"ocean_custom_retina_logo":0,"ocean_custom_logo_max_width":0,"ocean_custom_logo_tablet_max_width":0,"ocean_custom_logo_mobile_max_width":0,"ocean_custom_logo_max_height":0,"ocean_custom_logo_tablet_max_height":0,"ocean_custom_logo_mobile_max_height":0,"ocean_header_custom_menu":"0","ocean_menu_typo_font_family":"0","ocean_menu_typo_font_subset":"","ocean_menu_typo_font_size":0,"ocean_menu_typo_font_size_tablet":0,"ocean_menu_typo_font_size_mobile":0,"ocean_menu_typo_font_size_unit":"px","ocean_menu_typo_font_weight":"","ocean_menu_typo_font_weight_tablet":"","ocean_menu_typo_font_weight_mobile":"","ocean_menu_typo_transform":"","ocean_menu_typo_transform_tablet":"","ocean_menu_typo_transform_mobile":"","ocean_menu_typo_line_height":0,"ocean_menu_typo_line_height_tablet":0,"ocean_menu_typo_line_height_mobile":0,"ocean_menu_typo_line_height_unit":"","ocean_menu_typo_spacing":0,"ocean_menu_typo_spacing_tablet":0,"ocean_menu_typo_spacing_mobile":0,"ocean_menu_typo_spacing_unit":"","ocean_menu_link_color":"","ocean_menu_link_color_hover":"","ocean_menu_link_color_active":"","ocean_menu_link_background":"","ocean_menu_link_hover_background":"","ocean_menu_link_active_background":"","ocean_menu_social_links_bg":"","ocean_menu_social_hover_links_bg":"","ocean_menu_social_links_color":"","ocean_menu_social_hover_links_color":"","ocean_disable_title":"default","ocean_disable_heading":"default","ocean_post_title":"","ocean_post_subheading":"","ocean_post_title_style":"","ocean_post_title_background_color":"","ocean_post_title_background":0,"ocean_post_title_bg_image_position":"","ocean_post_title_bg_image_attachment":"","ocean_post_title_bg_image_repeat":"","ocean_post_title_bg_image_size":"","ocean_post_title_height":0,"ocean_post_title_bg_overlay":0.5,"ocean_post_title_bg_overlay_color":"","ocean_disable_breadcrumbs":"default","ocean_breadcrumbs_color":"","ocean_breadcrumbs_separator_color":"","ocean_breadcrumbs_links_color":"","ocean_breadcrumbs_links_hover_color":"","ocean_display_footer_widgets":"default","ocean_display_footer_bottom":"default","ocean_custom_footer_template":"0","ocean_post_oembed":"","ocean_post_self_hosted_media":"","ocean_post_video_embed":"","ocean_link_format":"","ocean_link_format_target":"self","ocean_quote_format":"","ocean_quote_format_link":"post","ocean_gallery_link_images":"off","ocean_gallery_id":[],"footnotes":""},"categories":[1],"tags":[],"class_list":["post-3464","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","entry","has-media"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How a Change in Mortgage Rate Impacts Your Homebuying Budget - Skyrise Real Estate Group<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/skyrisere.com\/listings\/2021\/04\/06\/how-a-change-in-mortgage-rate-impacts-your-homebuying-budget\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How a Change in Mortgage Rate Impacts Your Homebuying Budget - Skyrise Real Estate Group\" \/>\n<meta property=\"og:description\" content=\"Mortgage rates are on the rise this year, but they\u2019re still incredibly low compared to the historic average . However, anytime there\u2019s a change in the mortgage rate, it affects what you can afford to borrow when you\u2019re buying a home. 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However, anytime there\u2019s a change in the mortgage rate, it affects what you can afford to borrow when you\u2019re buying a home. 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