Monthly Housing Payments Are High But Seem Unlikely To Be Lower Over The Next Year

Mortgage interest rates are higher they have been in over 20 years.

Home prices are higher than they have ever been.

Combine these two factors and you'll find monthly housing payments that are high.  Quite high.  Too high?

Some would be home buyers are hesitating to move forward with a home purchase because of how high the monthly mortgage payment will be on their new home.

This is understandable and quite reasonable.

If your lender approves you for a mortgage payment of $2500 per month but you are only comfortable committing $2200 per month to a housing payment then perhaps you shouldn't buy that house that you love that would require a $2500 monthly housing payment.

But... if you decide not to buy now (or soon) you probably shouldn't come to that decision within the context of waiting to buy in six to twelve months when you hope to have a lower housing payment.

After all... what would we need to see in order to be experiencing lower housing payments?  We'd need to see either...

[1]  Meaningfully lower mortgage interest rates -- which most economists don't seem to think will be showing up anytime in the next year.

[2]  Lower home prices -- which don't seem likely to exist anytime in the next year.

Is it possible that mortgage rates will decline back to 5% or 6%?  Sure, it's possible - but it doesn't seem likely, at all.

Is it possible that home prices will decline over the next year?  Sure, it's possible - but it doesn't seem likely, at all.

So, a year from now, you'll likely have a very similar mortgage payment as you would have today -- or possibly even higher.

 

Now, for all you contrarians out there -- tell me I'm wrong -- and tell me how.  Will mortgage interest rates decline over the next year?  Will home prices decline over the next year?