Since the election, interest rates have started going up. This will have a direct effect on the cost of housing. A one-half percent change in interest rates can affect your monthly payment more than a five percent change in home prices.
When does one-half equal more than five? When interest rates increase! Here’s what a change in interest rates costs you compared to a rise in home prices.
I’ve used a $500,000 purchase price with a 20 percent down payment. Interest rates are broken down in 0.25 percent increments from 0 to 1 percent. Price increases are broken down in 2.5 percent increments from 0 to 10 percent.Continue reading When Does One-Half Equal More Than Five?