Most people know what type of payment they can afford each month. We call that "buying power." For obvious reasons, the larger payment you can afford, the more house you can purchase.
However, as interest rates rise, your buying power will decrease. At the beginning of 2014, interest rates are close to 4.5%. By the end of 2014, interest rates are predicted to rise roughly 1%.
Below are some GREAT charts that show you exactly how much you can afford at each interest rates. Here are some ideas of how they can help you:
- Print these out and take them with you as you search for homes!
- Forward this blog to your friends who are thinking of buying
- Show your agent so they can help you
- Email me for further explanation and consultation!