For the past couple of years, it’s been tough for a lot of homebuyers to make the numbers work. Home prices shot up. Mortgage rates, too, and a number of people stopped looking because it just didn’t feel possible. Maybe you were one of them!

But there’s some encouraging news. If you’ve been waiting for a better time to jump back in, affordability may finally be showing signs of improvement this fall.

The latest data shows the typical monthly mortgage payment has been coming down, and is now about $290 lower than it was just a few months ago, and here’s why this is happening. The cost of buying a home really comes down to three things: mortgage rates, home prices and your wages. Right now, all three are finally moving in a better direction for you. While that doesn’t mean it’s suddenly easy to buy at today’s rates and prices, but it does mean it’s not as challenging.

Mortgage Rates. Mortgage rates have come down compared to earlier this year. In May, they were roughly 7 percent and now, they’re closer to 6.3 percent! That may not sound like a big deal, but it does matter. Even small changes in rates can make a difference in your monthly payment. Compared to when rates were 7 percent, if you take out an average $400K mortgage now at 6.3 percent, it’ll cost about $190 less a month based on just rates alone and for some people, that’s been enough to make buying a home possible again. Lenders have explained it this way: The downward rate movement spurred the strongest week of borrower demand since 2022.  Mortgage applications increased to the highest level since July and continued to run more than 20 percent ahead of last year’s pace.

Home Prices. After several years of prices rising very rapidly, price growth has finally slowed. Economists have said: 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 actually a big relief. That moderation makes it easier to plan your budget and in some markets, prices have even dipped slightly. If you’re in one of the markets, you may be able to find something that’s more affordable than you’d expect.

Wages. According to the Bureau of Labor Statistics (BLS), wages are up near 4 percent annually. It’s been stated: wage growth is now comfortably outpacing home price growth, and buyers have more choices. In other words, the typical paycheck is rising faster than home prices right now, which helps make buying a little more affordable. Now, it’s not a big difference, but in a market like this, every bit counts.

What this means for you is lower rates, slower price growth, and stronger wages might be enough to make the numbers finally work for you this fall. While affordability is still tight, it’s a little easier on your wallet to buy now than it was just few months ago. Remember, data shows the typical monthly mortgage payment is already around $290 lower than it was earlier this year.

Have you been wondering if it’s worth taking another look at buying? Contact a member of The Marzeotti Group or another Real Estate Professional to re-run the numbers. Together you can go over your budget, see what’s changed, and figure out if this fall is the time to turn window-shopping owning something of your own!