How Much Home Can You Afford?

Janice Overbeck Real Estate Leave a Comment

If you’re considering buying, here’s why now is the best time to do so.

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People commonly ask us and our lender partners, “How much home can I afford?” We know that interest rates are increasing, which means your monthly payments will also rise. A year ago, we saw around 3% interest rates, and now they’re at about 4%, and they may continue to rise. That means that later this year, you could potentially afford less home than you can today. 

A 1% rate hike on a $300,000 home is $180 more per month. However, we’re still experiencing low interest rates, so if you’re considering jumping into the market, we recommend doing so now.

This is the year to buy a home.

Many people have been waiting for the real estate market to crash for the past two years, and all the while home prices have been growing and inflation has spiked. We’re in a seller’s market, and we know it’s challenging to find a home when there are multiple offers on so many. However, this is the year to buy a home.

The difference between $400,000 and $430,000 may seem like a major jump, but with the present rates, that comes down to about $150 more per month. Don’t let $150 stop you from purchasing the home of your dreams if you can afford it. Be flexible with the amount you’re willing to pay, and know what you can afford. If you buy a home this year, in a few years when you look back, you’ll likely be happy that you made that choice. 

Feel free to call or email us if you want to buy a home or need a recommendation for a wonderful lender. We’d love to be your real estate resource.

About the Author

Janice Overbeck