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hmiamid OP t1_irg51qj wrote

Reply to comment by squeevey in [OC] House price you can afford by paying 1000/month for 30 years vs. interest rate by hmiamid

Interesting (no pun intended). I suppose we pay more downpayment at a high interest rate. Can we actually afford to save more in a high interest rate environment to prepare for a downpayment?

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squeevey t1_irg8reg wrote

Well, some were already saving regularly in preparation to purchase a house when housing prices skyrocketed. So it didn't seem prudent make rushed purchases, especially when you didn't have the EXTRA cash (on top of the down payment) to go above your proposed house price.

Some people are sitting on cash at the moment, waiting for the right time.

My point though is that with ANY compound interest chart, the chart only represents the LOAN you took, not necessarily the price of the house.

You may be able to afford 300,000 house when you chop $50K off the principle. It's all about how the various maths work for your specific situation.

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Tak_Galaman t1_iria871 wrote

Ooo yeah I was trying to figure out why this was so far off from my reality. It's because this chart is about the mortgage you can afford not the total house price.

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pivantun t1_irgd8h9 wrote

I think it's the other way around: When interest rates are low, house prices get inflated, and so downpayments go up.

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