Rising mortgage rates are not yet jeopardizing housing affordability, according to a new report by Goldman Sachs that found affordability still far above past average levels.
“For a mortgage interest rate of 3.81 percent, the average home buyer can afford to buy a house worth $279,000—45 percent above the current median sales price of existing homes,” according to the Goldman Sachs report. “Even if mortgage rates continue to increase from here, the median home will still be affordable to the median borrower, based on the conventional 25 percent debt-to-income threshold.” Goldman Sachs researchers say that from 2014 to 2016, they expect housing prices will increase about 4 to 5 percent each year. Watch our Video....
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