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Surging mortgage rates make home buying in D.C. more expensive – Axios

Illustration: Annelise Capossela/Axios

Mortgage rates surpassed 5% — the highest they’ve been in years, according to data shared by Freddie Mac.

Why it matters: Low mortgage rates made buying in a seller’s market more afford…….

Illustration: Annelise Capossela/Axios

Mortgage rates surpassed 5% — the highest they’ve been in years, according to data shared by Freddie Mac.

Why it matters: Low mortgage rates made buying in a seller’s market more affordable in the pandemic.

  • In March 2022, median home sale values in D.C. were up 9.4% year over year, and now borrowing money is more expensive, too.
  • Already-fatigued buyers could be priced out of the market.

Data: Freddie Mac, Redfin. Chart: Simran Parwani/Axios

State of play: A year ago, mortgage rates were at 2.97%. Late last month they were at 5.11%.

If you were to take out a $500,000 30-year mortgage loan in April 2021, your monthly principal and interest would be around $2,100, according to numbers shared by Freddie Mac.

  • Your monthly payment on a $500,000 30-year loan in April 2022 (at 5.11%) would be $2,718.
  • That’s $618 more per month; $7,416 a year; and $222,480 more over the life of your loan.

What’s next: Mortgage rates are expected to rise throughout the year, averaging 4.6% for 2022 and 5% for 2023, according to Freddie Mac’s trend forecast.

  • If demand cools because of rising rates, housing prices could stabilize.
  • We’re still in a critical supply crunch, so inventory would have to catch up to the remaining demand in order for prices to actually cool.

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Source: https://www.axios.com/local/washington-dc/2022/05/09/mortgage-rates-home-buying-dc-expensive

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