- $1279/Month @ 6%
- $1526/Month @ 8%
- $1788/Month @ 10%
$300,000 Mortgage over 25 Years =
- $1919/Month @ 6%
- $2289/Month @ 8%
- $2683/Month @10%
$400,000 Mortgage over 25 Years =
- $2559/Month @ 6%
- $3052/Month @ 8%
- $3557/Month @ 10%
You can see how interest can make a huge impact on your payments. Interest rates can go up and the have in the past.
Who can afford these payments?? Based on 35% of Gross Monthly Income.
- $50,000/Year should be paying around $1458/Month for total house hold expenses
- $60,000/Year should be paying around $1750/Month for total house hold expenses.
- $70,000/Year should be paying around $2041/Month for total house hold expenses.
- $80,000/Year should be paying around $2333/Month for total house hold expenses
- $100,000/Year should be paying around $2916/Month for total house hold expenses
Don't forget that these are included in you Total Monthly Housing Expenses:
- Property Tax's, which increase as your property appreciates.
- Gas and Electricity
- Garbage and Sewer
- Metered Water
- Up Keep, Roof, Hot Water Tank, etc.
- Saving for retirement?
- Saving for Children's Education?
- Job Loss?
- Furniture for your home.?
- Clothing, Food.?
- Car Payments?
It's quite scary when you actually take the time to add it all up.
From what I can see here the only people that can afford to purchase at these prices will be those who are already in the market and have equity, those who have saved up a lot for a down payment, and those who are wealthy.
I don't know what percentage of the population is fortunate enough to be in this situation. But I am sure it isn't enough to sustain the market.
Considering the price of Condos, most "First Time Buyers" have been priced out.
If prices stay like they are all those "Baby Boomers", who want the younger generation to fund their retirement, are not going to be able to find enough qualified buyers.