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For buyers who can’t pay cash for a home, the monthly payment will depend both on the initial sale price and on the interest rate of their loan. In this section, we provide some historical perspective on mortgage interest rates, from 1972 to date. We translate this interest rate data into more meaningful terms, by charting the payment required to cover a $300,000 loan, showing that this payment peaked at about $4100 in 1981/1982, but dropped to about $1400 in 2012-2017. Finally, we translate this into borrowing power, showing how a $2000 monthly payment in 1981/1982 would cover a $250,000 loan, while from 2012 to 2017, it would have gotten you a loan of around $425,000.
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