I know I wrote about how rates were headed in the right direction. They did go down a little but after last week’s rate hike by the federal reserve, they went up to 6.81% for the 30-year conventional mortgage. (Freddie Mac)
That is high, especially considering how expensive houses are. Last week I was talking with some older homeowners who pointed out that when they bought a house rates were over 8%. At the time one of them had a job that paid $3.50 an hour and the house cost $15,000. The house cost about the same as two years’ income.
The table below shows how much income is needed to buy a house in Minnesota. The numbers are provided by Minnesota Housing Agency.
| Household Size | 11-County Twin Cities Metro Area* | Dodge and Olmsted Counties |
|---|---|---|
| 1- 2 Person | $89,000 | $89,000 |
| 3 Person | $101,000 | $101,000 |
| 4 Person | $112,000 | $112,000 |
| 5 Person | $121,000 | $121,000 |
