How do rising interest rates influence how much you can afford to pay for your new home?
Goal: to keep your principal and interest payment between $1850 – $1880 per month.
For example, with a 3.75% interest rate you can afford a $400,000 home. At 4.25% you can afford a home of $380,000, or a 5% lower price. At 4.75%, your home would be $360,000, a drop of 10% in affordability.