Looking to buy a home in Alabama soon?
According to a recent analysis by , your mortgage is likely to be significantly higher than it was a year ago due to rate hikes construction cover.
According to the analysis, Alabama was the 10th most affected state by recent rate hikes.
Mortgage payments increased 69% year over year in Alabama. That’s slightly more than the national average of 66%. Florida saw the biggest increase, with mortgage payments up about 81%.
“At a regional level, the Southeast has seen some of the largest increases in mortgage payments over the last year,” said Jonathan Jones, a senior researcher at Construction Coverage. “Across the US, homebuyers in Florida have been hardest hit by rising interest rates: Mortgage payments on a median-priced home in Florida have increased by over 80% since 2021. South Carolina is close behind, with mortgage payments increasing by a multiple of 76%. While mortgage payments have increased dramatically in the US, the smallest increases have been in Idaho and California, where mortgage payments increased by 52.3% and 56.3%, respectively.”
Jones said in his analysis that “mortgage rates are now more than double what they were in early 2021.”
“As a result, real estate prices have started to rise slowerbut not enough to offset the increased cost of borrowing caused by higher interest rates,” Jones said.
The Auburn-Opelika metro area saw the largest percentage change in mortgage payments in Alabama at nearly 82% year over year. According to the analysis, this was the 13th largest year-over-year increase among all metro areas in the country. A mortgage payment in Auburn-Opelika is currently $1,453, up from $800 a year ago. The median home price is $287,662.
“At the beginning of the COVID-19 pandemic, the Federal Reserve took aggressive actions to keep the economy going,” Jones said. “Mortgage rates began to fall steadily, with the average 30-year fixed rate hitting an all-time low of 2.65% in January 2021. However, inflation began to rise rapidly, and the Federal Reserve began raising interest rates in March. When gradual rate hikes were not enough to curb inflation, the Fed began to act more aggressively. In November, the average 30-year fixed rate briefly topped 7%, its highest level in more than two decades.”
The mortgage payment for a median home in Alabama is now $1,099, up from $650 a year ago. According to the study, the median home price in Alabama is currently $217,551.
According to the study, the median home price was calculated from the Zillow Home Value Index, and the monthly mortgage payment for a mid-priced home was calculated assuming a 30-year fixed-rate mortgage with a 20% down payment.
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