We saw mortgage rates rise by 2/10’s of a percent last month. That rise will cost new borrowers an additional $12 per month for every $100,000 borrowed. Average U.S. rates for 30-year fixed rate mortgages are currently at 4.72%. At the end of last month, they were sitting at 4.52%. After a few months of relatively stability, the general forecast for a continued rise over the next twelve months is becoming a reality.
Even with the expected interest rate rise over the next twelve months, we will still be considerably lower than the long-term average mortgage interest rates in our country. While it’s hard to believe in today’s environment, the long-term average is still over 8%. When you compare monthly payments at today’s rates versus the long-term average, homeowners are currently saving over $220 per month per $100,000 borrowed. That makes mortgaging today’s homes considerably more affordable than historic averages.
That said, mortgages are more expensive now than they were when the year started. The average increase in monthly payments per $100,000 borrowed with a 30-year fixed price mortgage is $43 per month. If you max out a conventional mortgage, that means your monthly payment will be around $190 more per month now than it would have been on January 1st.