The cost of buying a home has increased quite a bit over the past five years due to several main factors...

1.  Higher home prices.  :-)

2.  Higher mortgage interest rates.

3.  Higher real estate tax rates.

Which leaves some would-be home buyers wondering... will it be more affordable to buy a home in Harrisonburg in 1, 3 or 5 years?

I think the answer is "probably not" - but let's dig in a bit...

Home Prices - Even as mortgage interest rates have pushed monthly housing costs higher and higher over the past few years, home prices have kept on rising.  It seems very likely that this will continue to be the case over the next 1, 3 and 5 years - thus changes in home prices will probably not make it more affordable to buy a home in Harrisonburg.

Mortgage Interest Rates - It is certainly possible that we will see lower mortgage interest rates in 1, 3 or 5 years.  Mortgage interest rates are currently staying mostly between 6.5% and 7%.  If they fell to 6% or 5.5% or 5%, each reduction would make it more affordable to buy a home in Harrisonburg.  That said, if it takes three years for rates to meaningfully decline, and home prices have risen during that timeframe, homes might not be any more affordable.

Real Estate Tax Rates - While there have been some periods of time when real estate rates have declined, they almost always stay steady or increase.  We shouldn't count on lower real estate tax rates in the next five years to help with housing affordability.

New Construction - New home communities can be a bit of a wildcard that could help it become more affordable to buy a home in Harrisonburg.  If enough new homes are built (at a variety of price points) that could slow the increase in home prices over time.  Do note, however, that for buying to become more affordable, these new homes would have to be offered at prices that might not be possible given rising construction costs.

So... if you conclude that it is too expensive to buy a home in Harrisonburg today, should you expect it to be more affordable to buy such a home in 1, 3 or 5 years?  It's certainly possible, but it doesn't seem likely an overly likely trajectory.

Want to chat more about the market, the buying process or real estate in general?  Reach out anytime.