Here’s the new cost of a mortgage in every US state

  • Mortgage rates rose from 3.22% in January to 4.67% in April, reducing affordability.
  • In some states, average monthly housing costs have increased by more than $500, according to the NAR.
  • Check out our interactive map to see the differences between each US state.

Rising mortgage rates are increasing the cost of owning a home in the United States, with median home mortgage payments in some states rising by more than $500 between January and March, according to estimates from the National Association of Realtors.

The average 30-year fixed mortgage rate Pink from 3.22% at the beginning of January to 4.67% at the end of March, and has been rising steadily since, adding to the monthly costs of paying down a house. Although costs continue to rise, they remain low by historical standards, with these rate levels last seen in 2018.

In California, the median increase in mortgage costs from early January to late March with a 10% down payment was $560, with the median mortgage payment in the state costing $3,540 per month.

This marks a general downward trend in affordability on the West Coast, with median monthly costs in Washington and Oregon increasing by $430 and $400, respectively.

But Nadia Evangelou, senior economist and head of forecasting at the NAR, said there were still “pockets of affordability” in rural states. In Arkansas, the median monthly price increase was $140, while neighboring states of New York and New Jersey, such as Connecticut and Pennsylvania, saw relatively moderate increases.

Why Are Mortgage Rates Rising in the United States?

Mortgage rates have continued to accelerate this year after hitting record lows in 2021. One driver is rising mortgage rates. federal funds ratewhich was raised twice by the US Fed already this year, with six more expected before the end of 2022 after inflation hit 8.5% last month.

This, Evangelou told Insider, has a ripple effect on the housing market: “The short-term interest rate that the Fed sets is the rate at which banks borrow and lend to each other. Although this is not the rate consumers pay, a higher rate for banks tends to make borrowing more expensive for consumers.”

Evangelou said that ultimately drives 10-year Treasury yields, which are historically tied to mortgage rates, particularly the conventional 30-year fixed mortgage rate chosen by buyers.

While some factors could slow the pace of interest rate rises, with an expected slowdown in inflation weakening the case for further rate hikes, Evangelou said mortgage rates are currently unlikely to fall. below 3% anytime soon.

What has been the impact on the US housing market?

Evangelou said rising borrowing costs have driven more than 9 million homebuyers out of the market, as Insider previously reported. This meant that an increasing number of people were competing for a decreasing number of homes, with 125 households vying for an affordable home this year, compared to 45 households for each affordable home before the COVID-19 pandemic.

Insider’s Jordan Pandy previously reported that the number of people rushing to block mortgages soared 31% in March as borrowers tried to keep their costs from rising further.

First-time buyers face an increasingly competitive market, with investors and cash purchases increasing since the pandemic. Homebuyers told Insider they faced tough ultimatums, including rental deals, which involved new landlords paying for sellers to live in their homes rent-free for several months after the deal was struck. a sale.

But Evangelou told Insider that weak housing supply, which has fallen to record lows this year, meant prices were unlikely to fall as they did after the mortgage crisis in risk of 2008. Some economists agreed, telling Insider’s Alcynna Lloyd that the market is very different from the last housing bubble.

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