Rochester MN Homes for Sale
Published
by
on May 2, 2011
Home affordability in the United States is nothing short of amazing. Even though current price trends for the United States and Canada are considerably different, the same principle applies in both cases: clients need perspective and they need to look beneath surface statistics before making informed decisions
The first chart below dramatically illustrates the impact of lower interest rates on housing costs, and the relative affordability of housing in the United States. The cost of a loaf of bread and a gallon of gas has more than tripled since 1989, and car prices have nearly doubled. While the median price of a new home has increased by 70 percent, mortgage interest rates, which stood at 10 percent back in 1989, are less than half of what they were back then. The impact of rock-bottom interest rates is that the monthly mortgage payment on a median priced home in the United States has increased by a mere $4 since 1989. Rochester MN Homes for Sale
Rochester MN Homes for Sale
Unless a buyer is paying cash, the monthly payment tends to be a far more relevant number than the home’s actual purchase price. So for buyers who are waiting for home prices to hit the floor, before buying it’s important to point out that the possibility of a slight drop in the price of a home will have very little impact on the monthly payment, while even a slight rise in interest rates (a far more likely scenario) will have a significant impact.
Rochester MN Homes for Sale
