The standard American household now pays 31% of their monthly income on housing, which is on the rise from 29% one week prior, and 24% in December.
According to Fortune, back in December, the average 30-year fixed mortgage rate stood at 3.11%. A borrower taking on a $500,000 mortgage at that rate would owe $2,138 per month. Now that the average rate is at 5%, that loan if issued today would cost $2,684 per month. Over the course of the 30-year loan, that’s an additional $196,700.
Rising mortgage rates could be a good thing as the market needs to get away from the incredibly low inventory according to Logan Mohtashami, lead analyst at HousingWire.