Mortgage payments are 19% more expensive than last year, Redfin data shows. The typical homebuyer’s monthly mortgage payment was $2,605 during July. That’s largely due to surging home prices and higher mortgage rates, which have raised the cost of borrowing. Loading Something is loading.
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Mortgage payments are more expensive than the previous year, thanks to homebuyers facing surging mortgage rates and home prices.
The monthly mortgage payment on a typical US home was $2,605 during the four weeks that ended July 30, up 19% from a year ago, according to the real estate listing site Redfin. That’s just below the all-time-high monthly mortgage payment of $2,637, which was notched in early July.
The increase comes as the median US home is now priced at $380,250, Redfin said, a 3% increase from last year. Meanwhile, the average rate on the 30-year fixed mortgage inched higher to 6.9% this week, according to Freddie Mac data.
High rates have also worked to push up home prices, as they discourage homeowners from listing their properties for sale and worsen the shortage in housing inventory.
Those conditions make the current housing market one of the most unaffordable in history, per the Mortgage Bankers Association.
Experts say affordability conditions are unlikely to improve until mortgage rates dial back more significantly, though that’s unlikely to happen anytime soon. Mortgage rates are influenced by real interest rates in the economy, and real interest rates could stay elevated through the end of the year as the Fed continues to monitor inflation.
The 30-year fixed mortgage rate could ease to just 6% by the end of the year, Redfin’s deputy chief economist previously estimated. Meanwhile, home prices could surge 6% in 2023, the American Enterprise Institute said in a recent report.