According to John Burns Consulting, potential home buyers and media are focused on the wrong housing market metric – price. What consumers and the media are ignoring is the monthly payment, which is superb right now and unlikely to get much better.
If prices fall another 10 percent, but mortgage rates rise 1 percentage point, fewer people will be able to qualify to buy a house.
If prices stayed flat and mortgage rates inched up 1 percentage point from 4.5 percent to 5.5 percent, the same house would cost you 12 percent more per month to buy. A movement from 4.5 percent to 6.5 percent would increase your mortgage payment by 25 percent.
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