SPOKANE, Wash. — According to Homebuyer.com, Washington is one of the top five most expensive states to purchase a home. Despite the mortgage company reporting the evergreen state tips the national scale, real estate agent Melissa Murphy said home buying in Spokane is more practical today than recent years.
“With our average house price being about 480, we're still much more affordable and favorable," Murphy said.
Still, high interest rates are continuing to affect buyer’s purchasing power.
“Now that interest rates are going up, it will affect that total amount spent per month and we still want buyers to be very comfortable. Less than 30% is ideal. Less than 20% of their take home income is even better,” Murphy said.
Homebuyer.com reports more than 20 percent of an average Washingtonian's income is needed to purchase a house at the median home price.
“With rising interest rates, it does crunch how much a buyer is able to buy," Murphy explained. "One year ago, with the average price point of 500,000. A buyer needed 50,000 in income. To buy today, fast forward, they need 70,000 in annual income a year. No other debts in order to buy the same house.”
But Murphy said buyers shouldn’t let high interest rates discourage them.
She said today’s housing market is more kind to prospective buyers.
“Sold prices, since the peak market of this summer are already down 8% in Spokane County," Murphy said. "But what's fascinating is the active asking price that sellers have asked is down now 28%. So sellers expectations are coming down quite a bit, which is such good news for buyers, even though they're going to pay a little bit more in in interest rates. We are seeing prices offset that here in the marketplace.”
Murphy is reminding her clients to be practical when buying a home, especially as Homebuyer.com said a common mistake for first time homebuyers is buying a house that’s out of their budget.