As of late summer 2023, the average 30-year fixed rate mortgage rate was 7.18% The median home sales price in the United States for the second quarter of 2023 was around $416,000.
a) Given a 20% down payment, what is the monthly payment required to purchase the median home at the average 30-year interest rate?
b) 2 years ago, the median home sales price was nearly equivalent to today, but the average interest rate was 2.85%. What would have been the monthly payment on a $416,000 home purchased with a 20% down payment in 2021?
c) At 2023 interest rates, what is the purchase price of a home that yields the same monthly payment as the home in part b? Assume you still have $83,200 as a down payment.