For the past couple of years, making the numbers work as a homebuyer has been a serious challenge. Home prices spiked, mortgage rates jumped, and a lot of people hit pause because it just didn’t feel doable. Maybe that was you.
But there’s encouraging news. If you’ve been waiting for a better time to jump back in, affordability may finally be improving this fall.
The latest data from Redfin shows the typical monthly mortgage payment has been coming down and is now about $290 lower than it was just a few months ago (see graph below).
Here’s why. The cost of buying a home really comes down to three things:
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Mortgage rates
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Home prices
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Your wages
Right now, all three are finally moving in a better direction. While it’s not suddenly “easy” to buy at today’s rates and prices, it’s definitely less challenging.
1. Mortgage Rates
Mortgage rates have dropped compared to earlier this year. In May, they hovered around 7%. Now they’re closer to 6.3% (see graph below).
That may not sound huge, but even small changes in rates can have a real impact on your monthly payment. Compared to when rates were 7%, an average $400K mortgage today at 6.3% costs about $190 less each month on the rate change alone.
And for some people, that’s been enough to make buying possible again. As Joel Kan, VP and Deputy Chief Economist at the Mortgage Bankers Association (MBA), explained on September 10th:
“The downward rate movement spurred the strongest week of borrower demand since 2022 . . . Purchase applications increased to the highest level since July and continued to run more than 20 percent ahead of last year’s pace.”
2. Home Prices
After years of rapid gains, price growth has finally cooled. As Odeta Kushi, Deputy Chief Economist at First American, puts it:
“National home price growth remains positive, but muted — low single digits — and we expect this trend to continue in the second half of the year.”
For buyers, that’s a relief. Slower price growth makes it easier to plan a budget. And in some markets, prices have even dipped a bit. If you’re in one of those markets, you may be able to snag something more affordable than expected.
3. Wages
According to the Bureau of Labor Statistics (BLS), wages are up nearly 4% annually. Lawrence Yun, Chief Economist at NAR, explains why that’s important right now:
“Wage growth is now comfortably outpacing home price growth, and buyers have more choices.”
In other words, paychecks are rising faster than home prices at the moment — not by a lot, but enough to help. In a tight market, every bit counts.
What This Means for You
Lower rates, slower price growth, and stronger wages might finally make the numbers work for you this fall.
Affordability is still tight, but it’s a little easier on your wallet now than it was just a few months ago. Data from Redfin shows the typical monthly mortgage payment is already around $290 lower than earlier this year.
Bottom Line
Wondering if it’s worth another look at buying?
Let’s run the numbers together. We can review your budget, see what’s changed, and figure out if this fall is the time to turn window-shopping into key-turning.
