Setting Your Max Purchase Price When Mortgage Rates Cross 8%  

October 23, 2023

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As mortgage rates go up, your purchasing power drops.

The relationship is direct. For every 1 percent increase in mortgage rates, your maximum home purchase price drops by 11 percent.

Since February, rising rates have taken 20% off what you can afford, so it's important to re-assess and recalibrate your home purchase parameters.

If you pre-approved your mortgage earlier this year, it's time to pre-approve your mortgage again.

Click here: See how much home you can afford. 

When a lender pre-approves your mortgage, you find out how much home you can buy and your rates. Your lender will tell you how far your payment takes you.

But first: watch this video on picking the right payment.

As mortgage rates rise, getting a home that meets your budget becomes more important. There's less room for error. So take control and be the best buyer you can be.

HOMEBUYER.COM STATISTIC OF THE DAY
Source: FFEIC

The Top 10 ZIP Codes for Gen Z Home Buyers:

1. Atascosa, Texas 78002

2. Jarrell, Texas 76537

3. Odessa, Texas 79762

4. San Antonio, Texas 78245

5. Hockley, Texas 77447

6. Clarksville, Tennessee 37042

7. Nevada, Texas 75173

8. Lubbock, Texas 79416

9. Jacksonville, North Carolina 28546

10. Summerville, South Carolina 29483

Data represents purchase mortgage transactions for residential, owner-occupied 1-4 unit properties in 2022.

See the top 50 ZIP codes for Gen Z buyers here.

MORTGAGE RATE CALENDAR
Upcoming events that may change the direction of mortgage rates

October 25, 2023: New Home Sales

October 26, 2023: GDP

October 27, 2023: Personal Consumption Expenditure

October 31, 2023: Federal Open Market Committee Meets

Subscribe to our YouTube channel for additional insight.

FIRST-TIME HOME BUYER PROGRAMS
Status of select first-time home buyer bills in Congress
 
The Downpayment Toward Equity Act
A cash grant up to $25,000 for first-time, first-generation home buyers. 
- Last Action in Congress: June 21, 2023
- Status: Not yet passed
- Alternative Mortgages: Conventional 100, 100% USDA

The DASH Act
A $15,000 first-time home buyer tax credit.
- Last Action in Congress: March 7, 2023
- Status: Not yet passed
- Alternative Mortgages: HomeReady, HomePossible

The HELPER Act
A 100% mortgage for teachers & first responders.
- Last Action in Congress: May 10, 2023
- Status: Not yet passed
- Alternative Mortgages: Conventional 100, VA Mortgage

The LIFT Act
A mortgage that builds home equity faster.
- Last Action in Congress: June 22, 2023
- Status: Not yet passed
- Alternative Mortgages: None

The Middle Class Mortgage Insurance Premium Act

A bill to make mortgage insurance tax deductions permanent for homeowners earning less than $100,000/$200,000.

- Last Action in Congress: June 13, 2023
- Status: Not yet passed