How do interest rates affect home affordability?

Interest rates can have a significant impact on home affordability. Higher interest rates mean higher monthly mortgage payments, which can make it harder for buyers to afford a home. On the other hand, lower interest rates can make homes more affordable by reducing monthly payments. Additionally, lower interest rates can also allow buyers to qualify for larger mortgages, which may enable them to purchase more expensive homes. It is important to note that interest rates are determined by a variety of factors, including inflation, the overall economy, and the policies of the central bank. As a homebuyer, it is important to pay attention to interest rate trends and consider how they may impact your ability to afford a home.