Although interest rates can significantly affect the amount a buyer can afford to spend on a home, the changes in the home-buying market can help even out the mortgage rate increases.


Let’s consider a home listed at $400,000. Six months ago, that home likely would have sold for $450,000, and the monthly payment for its 30-year fixed mortgage at 4.5% would have been $2,280. Today, that home might close at $375,000, and the monthly payment at 6.5% would be $2,370, less than $100 more per month. As home prices moderate, the final price difference between a few months ago and now can be much less than you might assume.