Guess what? You can afford to pay more for a house

Plus, a storybook cottage in the Hollywood Hills

͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌  No images? Click here February 10, 2024 • Issue #128 Happy Saturday! This week, we’re digging into how much more home you can afford with today’s lower mortgage rates and a Tinseltown love nest with a musical connection.

How much home can you afford now?

Money, Getty Images Homebuying budgets are getting a boost right now thanks to the recent drop in mortgage rates. A report by real estate brokerage Redfin finds that would-be buyers with a $3,000 monthly budget gained almost $40,000 in buying power since last October, when mortgage rates came close to topping 8%. The increase means a buyer in that budget range could afford a home worth about $453,000 at today’s rates. Compare that to the $416,000 price tag a buyer with the same budget could afford when rates were at 7.8%, and you get a pretty nice upgrade. Naturally, the larger your budget, the more buying power you’ll gain with the drop in rates. But even buyers with a smaller budget are seeing a decent increase. Someone with a $2,000 monthly budget could now afford a home priced at $302,000 — $23,000 more than they could buy three months ago. Although mortgage rates are expected to decline throughout the year, nobody knows how much lower they’ll go (plus, there will naturally be some peaks and valleys along the way). But for anyone thinking of buying a home this year, it should be a bit easier than in 2023. Some buyers may look at predictions of lower rates as an opportunity to try to time the market, get better rates and have a chance at snagging their dream home. But that tactic, said Redfin chief economist Daryl Fairweather in the report, “is probably a waste of energy” because affordability won’t get significantly better in the next few months than it is now. Instead, buyers should make a decision based on their current finances and personal situation. “What matters most is whether the home meets your needs long-term and whether you can afford it,” she added.

How Much House Can I Afford?

Home Insurance Prices Are Soaring — Especially in These 5 States

Money Move of the Week

Say goodbye to budget-breaking home repairs Fed up with unexpected, wallet-draining repairs? Home warranties can act as a safety net against out-of-pocket costs for eligible wear-and-tear repairs on vital home systems and appliances you rely on. Statistics reveal homeowners spent an average of $6,000 on maintenance and repairs in 2022. Don’t add to that number — stay protected with a home warranty. See Money’s list of the best Home Warranty Companies and make the smart choice today.

Listing of the week

Dag Eliason and Alexandre Anu of The Agency Beverly Hills A fairytale home in L.A. This week’s unique listing is nestled among the Laurel Canyon hills on the appropriately named Woodland Lane. Originally built in 1926, this three-bedroom, three-and-a-half-bathroom home has cathedral ceilings, stained glass windows, and an octagon-shaped library. (Who doesn’t want an eight-sided reading room?) There’s also plenty of outdoor space to enjoy the canyon views — there are balconies on every floor, including a cute little terrace perfect for a romantic rendezvous. You also get a connection to musical history: the current owner is Rufus Wainwright, famous for singing a little ditty called “Hallelujah,” among other things. The property has over 2,000 square feet of living space and sits on 5,000+ square feet of woodlands. You can make this cozy little home yours for $2.2 million. Just reach out to Dag Eliason and Alexandre Anu of The Agency Beverly Hills. Dag Eliason and Alexandre Anu of The Agency Beverly Hills

’Til next time, P.S. Have you seen a unique listing on social media I should feature in this newsletter? Or have a question about housing or mortgages you desperately want answered? Let me know on Twitter at @LeslieLCook or via email at leslie@money.com. P.P.S. Have a friend who loves real estate or is looking for a home of their own? Please forward them this email or send them to the Money Moves subscription page.

Money’s Essential Home Buying Resources: Winter

On the hunt? Check out Money’s Mortgage Calculator, list of The Best Mortgage Lenders and look at the latest mortgage rates. Thinking of refinancing? Our list of The Best Mortgage Refinance Companies can help. You can also use our Mortgage Refinance Calculator or these refi tips. Key question: How much house can I afford?

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