After years of a red-hot market and prices rising exponentially, real estate has seen increasing interest rates due to attempts to get inflation under control.
A report by Redfin found that a buyer with a budget of $2,500 can now afford a $400,000 house with current interest rates, compared to a property worth $517,000 a few months back.
Since mortgage rates determine the size of monthly payments — and a buyer’s ability to afford a mortgage largely depends on whether monthly payments are within their budget — this is a huge blow to buyers.