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The best way to determine how much house you can afford is by working backward from your current budget. Current mortgage rates: The lower your mortgage rate, the more house you can afford. Where you live can impact home affordabilityHow much house you can afford depends a lot on where you live. How much house can I afford FAQsWhat percentage of my income should I spend on a house? The more debt you have, the less house you'll be able to afford.
Persons: You'll, Brian Walsh, Walsh, you'll, Freddie Mac, that's, it's, homebuyers Organizations: Business, CFP, . Census Bureau, National Association of Insurance, Consulting, homeownership, DTI, Chevron Locations: West Virginia, U.S, Washington, Alabama, New Jersey, Chevron
New tools help homebuyers navigate risk
  + stars: | 2024-10-04 | by ( ) www.cnbc.com   time to read: 1 min
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailNew tools help homebuyers navigate riskCNBC's Diana Olick joins 'The Exchange' with details about First Street's homebuyer tools to navigate climate risks for properties.
Persons: Diana Olick
For the whole U.S., the median rent is $1,406 and the median mortgage payment is $1,904. Cost of living comparison: Renting vs. buying by stateIn the U.S., the median rent is $1,406 and the median monthly mortgage payment is $1,904. In New York City, for example, median rent is $1,748, making it more expensive than most states, even though New York state's median rent is only $1,561. Median rent costs as a percentage of incomeIt's important to keep in mind that income also varies from state to state. Methodology: How we determined rent and mortgage costsOur median rent, household income, and mortgage payment data comes from the Census Bureau's 2023 American Community Survey 1-year estimates.
Persons: You'll, you'll, Grace, Molly Grace, Molly, Read Organizations: Hampshire, Dakota, Rhode, West Virginia, Alabama, Colorado, Indiana, Iowa, Maryland, Michigan, Montana, Nebraska, Tennessee, Washington, Survey, Business, Rocket Companies, Indiana University Locations: West Virginia , Mississippi, North Dakota, South Dakota, Kentucky, West Virginia , Arkansas , Mississippi , Indiana, Alabama, U.S, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Washington, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, Jersey, Mexico, York, Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Utah, Vermont, Virginia, Wisconsin, Wyoming, West Virginia, Dakota, New York City, New York, Hampshire
Noel Celis | Afp | Getty ImagesShares of Chinese property developers rallied on Monday after major cities in mainland China unveiled easing measures to boost homebuyer sentiment, following the central bank's blitz of policy stimulus. The Guangzhou city government said in a notice on Sunday that all restrictions on home purchases would be removed, effective from Monday. China Overseas Land & Investment and China Vanke climbed 5.06% and 12.89%. Mainland China's CSI 300 surged 6% Monday, after the index logged its best week in almost 16 years on Friday. The easing measures follow the central government's call last week to combat the property slump last week.
Persons: Noel Celis, China Vanke, Allen Feng, Gary Ng, Ng, Xi Jinping Organizations: HK, Afp, Getty, Mainland Properties, Longfor Group Holdings, Hang Lung, China Resources, ., . China Overseas Land & Investment, China's CSI, CSI, People's Bank of Locations: Guangzhou, China's, Guangdong, China, Shanghai, Hong Kong, . China, , Beijing, People's Bank of China
AssumptionAn assumable mortgage will let a borrower transfer the mortgage to someone else even if they haven't fully paid it off. Assumable mortgagesIf you have an adjustable-rate mortgage or a government-backed mortgage (including FHA, VA, and USDA mortgages), you might have an assumable mortgage. Finally, if you want to transfer a property into a trust, a mortgage transfer may be able to help, too. Mortgage transfer processIf you think a mortgage transfer is the right move for your needs, follow this step-by-step process. If the lender doesn't approve a mortgage transfer, you will need to explore other options, such as refinancing your mortgage or selling your house.
Persons: You'll, Molly Grace, Molly, Read, Aly J, Yale Aly J, Aly, She’s Organizations: Chevron, Business, Rocket Companies, Indiana University, Yale, Finance, Dallas Morning News, CBS, Forbes, Fortune, Money, Newsweek, US, Wall Street Journal, Yahoo Finance, Mortgage, National Association of Real, Insurance, Texas Christian University Locations: Chevron, Michigan
CNN —On Wednesday, the Federal Reserve cut interest rates for the first time since the early days of the COVID-19 pandemic, slashing its benchmark rate by half a percentage point and signaling more rate cuts by the end of the year. The supply of homes for sale hasn’t kept up with demand as homeowners who locked in ultra-low pandemic-era mortgage rates were less willing to sell their homes in a higher mortgage rate environment. Some experts believe falling rates could entice more homeowners to put their homes up for sale. In the past few months, rates have steadily fallen in anticipation of interest rate cuts. Does the Fed’s recent interest rate cut and the potential for more rate cuts in the future change your outlook as a homeowner or a potential homebuyer?
Persons: hasn’t, Freddie Mac Organizations: CNN, Federal Reserve
The median house price in the U.S. is now 5.8 times more than the median annual income of $80,000. That was, after all, the median price for a house in the area at the time. Jonathan OchartThe median price of a home in Los Angeles county is just under $960,000, according to Zillow listings data. It's just not a level playing field," says Ochart about the income now needed to afford a home. In Grand Rapids, median home prices were on the rise before the pandemic and then soared 54% from 2020 to $285,000 in June 2024, according to Zillow sales data.
Persons: Kelcie Lesko, Tim Khalil, Lesko, Khalil, they'll, Gen Xers, What's, — there's, they're, Daryl Fairweather, Kelly Diehr, homebuyers, you'd, Diehr, Jonathan Ochart, Ochart, It's, Timothy Ham, Timothy Ham couldn't, Ham, you've, That's, boomer, it's, Lawrence Yun, Millennials, Ramit Sethi, Rich, Brad Klontz, homebuying Organizations: CNBC, Homes, LA, National Association of Realtors, NAR Locations: New Jersey, Monmouth County, North Brunswick, Lesko, homeownership, U.S, Denver, Brazil, Los Angeles and New York, San Antonio, Los Angeles, Antonio, Texas, LA, Boise , Idaho, Tacoma , Washington, Grand Rapids , Michigan, Grand Rapids, Kalamazoo
While the Fed doesn’t directly set mortgage rates, its actions affect borrowing costs throughout the economy. The most apparent effect: An interest rate cut could help ease the upward pressure on mortgage rates, making one piece of the homebuying equation more affordable. Most investors are betting that the Fed will cut its benchmark interest rate by just a quarter-point on Wednesday. Some financial advisers counsel to wait until you can get a mortgage rate that is a full percentage point below the rate you’re already paying, said Fairweather. “If you got a 7.5% mortgage rate, you may already be in the money to refinance,” she said.
Persons: Freddie Mac, , Daryl Fairweather, Redfin’s, , it’s, Fairweather, We’re, Greg McBride, “ It’s, Leo Pareja Organizations: CNN, Federal Reserve, homebuyers, National Association of Realtors, Bankrate, eXp Realty Locations: Wells,
The Fed is expected to cut rates multiple times this year and in 2025, which means mortgage rates should continue decreasing. Will mortgage rates drop when the Fed cuts rates? If he or other Fed officials indicate that bigger rate cuts could be coming, mortgage rates may inch down. How Fed rate cuts affect mortgage ratesChanges to the federal funds rate don't directly impact mortgages, but mortgage rates tend to trend up when the Fed raises rates and go down when it lowers rates. The Fed could lower rates substantially by the time we reach the 2025 buying season, which means mortgage rates may be a lot lower, too.
Persons: Freddie Mac, Dan Burnett, Burnett, Jerome Powell, Powell, Fannie Mae, Scott Haymore Organizations: Fed, Federal Reserve, Housing Survey, TD Bank
Here’s a look at what could happen to inflation, jobs and the deficit if Trump or Harris win in November. That, among other things, would keep the top tax rate individuals pay at 37% compared to 39.6% before it went into effect. Meanwhile, the tax proposals Harris has put forth so far mostly involve imposing higher taxes, which would have a positive impact on the deficit. For instance, she’s endorsed raising the top individual income tax rate to 44.6% and the top long-term capital gains tax rate to 28% versus the current 20%. Taken together, the Penn Wharton Budget model estimates Harris’ proposals could increase the deficit by an additional $1.2 trillion by 2034.
Persons: Kamala Harris, Donald Trump, Harris, Goldman Sachs, Trump, Warwick McKibbin, Goldman, she’s, , Justin Wolfers, Kevin Dietsch, He’s, Elon Musk, She’s, Joshua Gotbaum Organizations: New, New York CNN, Labor Department, Trump, Peterson Institute for International Economics, Gross, University of Michigan, CNN, Federal Reserve, Treasury Department, Wharton Budget, Social Security, Penn, Wharton Budget Model, Penn Wharton Budget, Brookings Institution Locations: New York, United States, Penn
She focused on this gig early in the morning, in the evening, on the weekends, or during working hours on the days her full-time employer allowed her to work from home. While overemployment has increased Olivia's work-related stress, it's reduced her financial stress — something she said has helped her pursue a healthy romantic relationship. That's because the long working hours can take a toll, and remote job opportunities can be difficult to land. As long as she lives in her area of California, she's not sure she'll ever buy a home. Are you working multiple remote jobs at the same time and willing to provide details about your pay and schedule?
Persons: , Olivia, What's, Doxo, jugglers, she's, overemployment, Overemployment, it's Organizations: Service, Business, New York Times, BI Locations: California's Bay, San Francisco, San Jose, Bay, California
Starting August 17, new rules will roll out that overhaul the way Realtors get paid to help people buy and sell their homes. This could pave the way for real estate companies with alternative business models, like flat-fee and discount brokerages, to thrive. Redy, which operates nationwide, is a marketplace that allows real estate agents to bid on home listings, meaning agents could pay homesellers for the opportunity to represent them, cutting into their own commissions. “This is part of this notion of shifting how real estate is always done,” Cofini said. “Consumers don’t know this is coming,” Flyhomes’ chief strategy officer, Adam Hopson, said of the NAR changes.
Persons: Leo Pareja, Kevin Sears, ” Sears, , Mary Schumann, ” Schumann, TD Cowen, Shelly Cofini, ” Cofini, Flyhomes, Adam Hopson, Will, Madison Mathias, Mathias, I’ve, “ I’m Organizations: CNN — Realtors, Realtors, National Association of Realtors, eXp Realty, NAR, , CNN Locations: theory­, Minnesota, Chapin , South Carolina
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In 1973, the median size of completed single-family homes was 1,525 square feet, according to US Census data. But as the cost of buying a home has exploded and McMansions have fallen out of favor, homebuilders have reversed course, building smaller homes with an eye to first-time buyers. Today, smaller, often more affordable homes under 1,000 square feet are harder to come by in most US suburbs. According to an NAHB survey, 17% of homebuilders said they built homes on smaller lots in 2023 to support home sales, and 14% said they built more townhouses. Smaller homes and fewer amenitiesHeather Eisenmann, a Realtor who specializes in selling new construction in Clarksville, Tennessee, said that she’s noticed that many of the new homes she shows now have smaller bedrooms and living rooms.
Persons: Jordyn Carias, , homebuilders, Alan Ratner, , we’ve, Levittowns, wasn’t, Jacob Anbinder, ” Anbinder, Levitt, Irving Haberman, Michael Murray, Heather Eisenmann, she’s, ” Eisenmann Organizations: CNN, Zelman, Associates, National Association of Homebuilders, Cornell University, Sons, National Association of Realtors, Census Bureau Locations: Muscatine , Iowa, America, Levittown, New York, Puerto Rico, Real, United States, Horton, Clarksville , Tennessee, Muscatine, Sacramento
Given the many ways lower rates can affect your finances, here are some things to consider when deciding what steps to take in response. Here’s how lower rates may affect key areas of your financial life, along with tips on what to do about it. If that proves difficult to get, see if you can transfer your balance to a credit card from a credit union or local bank that offers lower rates than the biggest banks. And because many variables determine what that factor will be, it will be hard to figure out the impact of lower interest rates. His advice: Don’t keep more than six months’ to a year’s worth of living expenses in cash or cash equivalents.
Persons: , Greg McBride, ” McBride, , Chris Diodato, Diodato, you’ll, McBride, ” Dodiato, Collin Martin, don’t Organizations: New, New York CNN, Federal Reserve, Bankrate, Schwab Center, Financial Research, AAA Locations: New York, Schwab.com
Valentinrussanov | E+ | Getty ImagesThe Federal Reserve is poised to make the first interest rate cut in years this fall, which can influence mortgage rates to go down. To that point, people in the market to buy a home have been eagerly waiting for the Fed to cut rates. The Fed is meeting this week, but experts say it seems more likely that the first rate cut will come in September. That would be the first rate cut since 2020 in the onset of the Covid-19 pandemic. While mortgage rates are fixed and mostly tied to Treasury yields and the economy, they are partly influenced by the Fed's policy.
Persons: Chen Zhao, Freddie Mac, Refinance, it's, Zhao, Selma Hepp, Hepp, Jacob Channel, there's Organizations: Fed, Treasury, Mortgage, Association, Finance Locations: Redfin
What to do when the Fed starts cutting interest rates
  + stars: | 2024-07-27 | by ( Jeanne Sahadi | ) edition.cnn.com   time to read: +8 min
New York CNN —Over the past couple of years, the Federal Reserve aggressively raised its key interest rate to a 23-year high to beat down inflation. But, realistically, how much you’ll save when the Fed lowers rates will depend on how quickly it cuts and by how much each time. Since loan amounts are substantial, this is one area where even small cuts in interest rates could make a meaningful difference in what a homebuyer will pay. A couple of quarter-point rate cuts from the Fed won’t make it meaningfully cheaper, McBride said. A few rate cuts won’t make much of a dent in today’s record-high average rate of 20.7%.
Persons: , Greg McBride, ” McBride, , Chris Diodato, McBride, Diodato, you’re, ” Dodiato Organizations: New, New York CNN, Federal Reserve, Bankrate, Fed Locations: New York
A Thursday report from Zillow indicates that a typical starter home is now worth $1 million or more in 237 cities, up from 84 cities in 2019, underscoring America’s ongoing home affordability crisis. “We see the largest number of million-dollar starter homes in expensive coastal markets. To further complicate things for first-time buyers, the value of starter homes has grown at a faster pace than the average home. According to Zillow, starter home values have grown 54.1% over the past five years, while the average US home has increased by 49.1%. The nationwide average price tag for a starter home is $196,611, according to Zillow.
Persons: underscoring, ” Orphe, , It’s, homebuyer, Zillow, Jeffrey Jenkins, Divounguy, “ That’s, , Lawrence Yun Organizations: CNN, Gallup, National Association of Realtors, University of Southern Locations: Zillow, California , New York, New Jersey, University of Southern California, United States
Two renters pose in front of their new home that they're renting from Roots, a program that helps renters invest in real estate. Then Hunnicutt found a $1,050-per-month two-bedroom apartment tied to Roots, a real estate investment trust based in the Atlanta area that aims to help renters of the properties in its portfolio build wealth toward homeownership. Will Hunnicutt with his dog Bailey in his Atlanta home that he rented through Roots, a company that helps renters build wealth by investing in real estate. As buyers continue to struggle with home affordability, experts say programs that help with down payments may be worth another look. One barrier toward homeownership is having enough savings for a down payment.
Persons: Katie Curran, Will Hunnicutt, Hunnicutt, Bailey, It's, They're, homebuyer Organizations: CNBC, SurveyMonkey, National Association of Realtors, PMI, Mortgage Locations: Atlanta, U.S
You can get down payment assistance through CHFA's Down Payment Assistance Program or the Time To Own program. VermontThe Vermont Housing Finance Agency offers mortgages, down payment assistance, a first generation homebuyer program, and a mortgage credit certificate. NebraskaThe Nebraska Investment Finance Authority is another state housing finance agency that offers programs for first-time and repeat buyers alike. State first-time homebuyer programs FAQsHow do first-time homebuyer programs differ by state? You may be able to combine multiple forms of state-backed first-time homebuyer assistance, or get state assistance in addition to other, unrelated programs.
Persons: you'll, CHFA, DSHA, MaineHousing, NJHMFA, MHDC, UHC Organizations: Connecticut Housing Finance Authority, FHA, Housing Authority, Maine MaineHousing, Loan, Massachusetts MassHousing, New Hampshire New Hampshire Housing, New Jersey Housing, Mortgage Finance Agency, New Jersey Police, New York Mortgage Agency, Pennsylvania Housing Finance Authority, Vermont Housing Finance Agency, Alabama Housing Finance Association, Arkansas, Finance Authority, of Columbia Homebuyers, DC Housing Finance Agency, D.C, Florida Housing Finance Corporation, Georgia Department of Community Affairs, Georgia, Plus, Kentucky Housing Corporation, Louisiana Housing Corporation, Maryland Department of Housing, Community Development, Mississippi The Mississippi Home Corporation, North Carolina Housing Finance Agency, Carolina South, Carolina South Carolina Housing, Palmetto, SC, South Carolina National Guard, Tennessee Housing Development Agency, Virginia Virginia Housing, Virginia Department of Housing, West, West Virginia The West, West Virginia The West Virginia Housing Development Fund, Illinois Housing, Authority, Indiana, Indiana Housing, Community Authority ., Iowa Finance Authority, IFA, Kansas Housing, Assistance, Michigan, Housing Development Authority, Minnesota Housing Finance Agency, Missouri Housing, Commission, Nebraska, Nebraska Investment Finance Authority, North, North Dakota Housing Finance Agency, Ohio Housing Finance Agency, South Dakota Housing Development Authority, Economic Development Authority, Arizona The, Arizona The Arizona Industrial Development Authority, New Mexico Mortgage Finance Authority, Oklahoma, Oklahoma Housing Finance Agency, Texas The, Affordable Housing Corporation, Texas, Homes, Texas Heroes, Alaska Housing Finance Corporation, California Housing Finance Agency, Colorado, Colorado Housing, Hawaii Housing Finance, Development Corporation . Idaho, Idaho Housing, Finance Association, Montana, Montana Montana Housing, Nevada Housing Division, Oregon Oregon Housing, Community Services, Utah Housing Corporation, Washington, Washington State Housing Finance Commission, Wyoming Community Development Authority Locations: Connecticut, Delaware, New Hampshire New Hampshire, New Jersey, York The State, Pennsylvania, Rhode, Vermont, Alabama, Arkansas, Washington ,, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, Carolina, Carolina South Carolina, Tennessee, Virginia Virginia, West Virginia, West Virginia The West Virginia, Illinois, Indiana Indiana, Community Authority . Iowa, Iowa, Kansas, Michigan, Minnesota, Missouri, NIFA, North Dakota, North, Ohio, OHFA . South Dakota, Wisconsin, WHEDA . Southwest, Arizona, Arizona The Arizona, Mexico, Oklahoma, Texas, Texas The Texas, TSAHC ., Alaska, California, Colorado, Hawaii, Idaho, Montana Montana, Nevada, Oregon Oregon, Utah, Washington, Wyoming, Chevron
Determining your budgetYou can figure out how much house you can afford to buy using our free mortgage calculator. While you may already have an idea of what you think you can afford, you'll need to find out how the bank sees you. It will include a list of all of your finalized closing costs and how much cash you'll need to close. The final walkthroughBefore closing, you'll also get a chance to view the home one more time. How to buy a house FAQsHow much down payment do I need to buy a house?
Persons: You'll, George Chedid, Dana Bull, They're, Bull, you've, Don't, it's, They'll, you'll, they've, Chedid Organizations: Compass, Federal Housing Administration, US Department of Veterans Affairs, US Department of Agriculture, you'll, Homeowners Insurance Allstate, Insurance Locations: Kendall Park , New Jersey, Chevron, Boston
Some of the most important factors to consider when buying a house are price, size, and location. Location and neighborhoodLocation is something you're stuck with until you move, so be sure you're choosing a city, school district, and neighborhood that suits your needs. If homes are flying off the shelves, you'll need to be prepared to make fast offers that get noticed right off the bat. If the appraisal comes in lower than what you offer, you'll have to make up the difference or renegotiate with the seller. Evaluating a house's resale potential is critical, as you want to be sure you're making a smart investment of your money.
Persons: Glen Pizzolorusso, Hope, that's, they're, it's, you've, they'll, you'll Organizations: Glen Christopher Luxury, Facebook, Energy Locations: Connecticut, Chevron
Can a non-U.S. citizen get a mortgage loan? Challenges non-U.S. citizens may faceThough it's possible to get a mortgage as a non-U.S. citizen, that doesn't mean it will be easy. Buying a home as a non-U.S. citizen FAQsCan non-U.S. citizens get a mortgage loan? Yes, non-U.S. citizens can get a mortgage loan if they meet the lender's eligibility requirements and they provide necessary documentation. Eligibility for non-U.S. citizen mortgage loans is usually based on legal residency status, credit history, income verification, and down payment.
Persons: homebuyers, Nora Aguirre, she's, they've, Aguirre, Organizations: Migration Policy Institute, Taxation, National Association of Hispanic Real Estate Professionals, USDA, ., Internal Revenue Service, Social, Chevron Locations: U.S, Nevada, Chevron
Read previewProspective homebuyers may be better off staying on the sidelines: the housing market is on its way to a rare buying opportunity, with steep home price declines bound for key areas of the real-estate market in the coming years, according to one analyst. That's an additional ingredient on the top, which just makes it more likely that prices fall," Gerli told BI. AdvertisementThe situation in the South's housing market also bears some similarities to previous housing bubbles, Gerli noted. In key boom towns, home prices have shot up 50%-70% since the pandemic, though incomes have only risen 10%-20%, he said, citing municipal data. It'll take a long time for housing to become more affordable overall, given how overvalued the market is, Gerli said.
Persons: , Nick Gerli, Gerli, Freddie Mac, That's, Southern homebuilders, we've, it's, Redfin, Homebuyers, It's Organizations: Service, Business, National Association of Realtors, Builders Locations: Florida, Southern, Texas
Read previewProspective homebuyers may be better off staying on the sidelines: the housing market is on its way to a rare buying opportunity, with steep home price declines bound for key areas of the real-estate market in the coming years, according to one analyst. That's an additional ingredient on the top, which just makes it more likely that prices fall," Gerli told BI. AdvertisementThe situation in the South's housing market also bears some similarities to previous housing bubbles, Gerli noted. In key boom towns, home prices have shot up 50%-70% since the pandemic, though incomes have only risen 10%-20%, he said, citing municipal data. It'll take a long time for housing to become more affordable overall, given how overvalued the market is, Gerli said.
Persons: , Nick Gerli, Gerli, Freddie Mac, That's, Southern homebuilders, we've, it's, Redfin, Homebuyers, It's Organizations: Service, Business, National Association of Realtors, Builders Locations: Florida, Southern, Texas
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