Why are homes more affordable if prices are up?

Dallas homes are more affordable now despite the rising prices, low availability and increasing demand. How is that you ask?

It's the mortgage interest rates that are keeping home ownership within reach for many folks. Take look at this chart that shows what a $200,000 mortgage costs based on your interest rate. Rates have been inching up and that trend is predicted to continue.

 

The easy way to think of it is that a 1% difference in your interest rate roughly equals a 10% difference in the price of the home. If interest rates increase by 1%, then its about the same as paying 10% more for the property.

Take advantage of today's low mortgage rates or some day your kids may say "You mean you could have locked in a 30-year fixed rate mortgage under 5 percent and you didn't?"
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