Home Buyers Have 7% Less Power This Month – April 23, 2024

Video Transcript

How much purchasing power have you lost because mortgage rates jumped last week? Roughly 7%. That’s the effect of rising mortgage rates.

The maximum purchase price for a home that you can afford to buy as compared to April 1 is now lower by about 7%. It helps to put that into numbers. If a few weeks ago you were approved to buy a home for $150,000, now you can buy a home and get approved for $140,000.

If you were approved to buy a home for $250,000, today you’re approved at $230,000. A $500,000 home. That’s now $450,000.

And that’s how rising rates get you. Changes in mortgage rates affect your purchasing power as a buyer way more quickly than changes in home prices. It takes a whole year for home prices to change seven percent.

Mortgage rates made an equivalent effect in a little more than a fortnight. Want to see how much home that you can afford at today’s mortgage rates? Check our website for our self-serve mortgage approval.

It’s available 24/7/365. I’m Dan with Homebuyer.com. Happy homebuying.