As gas prices tend to rise with the summer months nearing us, have you ever wondered what the difference in buying power a potential home buyer would have?  In the mortgage lending world we don't include a buyer's monthly living expenes such as utilities, cost to fill up a tank of gas, food and so forth.  But as a homebuyer does, they take into account every dollar he/she earns and budgets for every dollar.

According to AAA - the average price of gas in the state of Washington is currently at $3.64 up .29 cents from a year ago.  If you take that increase in gas price and assume that a married couple that both commute and each has a car, fills up their car once a week and has a 16 gallon gas tank, that would equate to about $40 per month increase in their budge that they were not expecting just for gas.

So what does the $40 per month increase in gas consumption equate to 'How much home they can buy?'  If the couple were looking to buy a home for $250,000, they will now have to look at lowering their purchase price and look at homes priced at or below $241,500.  That may not seem like a big drop in price, but sometimes that can make the difference between a nice neighborhood or a great neighborhood, new home or an older home and so forth!!

Something to think about as you work with your clients in assisting them to find the right home!!

 

 

2 Comments on Rising gas prices - Can that affect a buyer's price range

FEB
22
2012
355,117 Points 3 Featured Posts Outside Blog Called Shot Master

Augie

Feel lucky for the average price per gallon in California is now $4.08. The real concern is the prediction of $5   per gallon by Memorial Day. I think this will effect sales, cheers cvc
9:54am • #1
548,445 Points 3 Featured Posts Outside Blog

Augie, your post hit home with me.  I live and work in a very middle class area northwest of Toronto.  One of the reasons people choose to live here, in addition the lifestyle, is the affordability.  This is somewhat counterfeited as fuel prices rise, since the cost of commuting to work also rises.
11:53am • #2


What does the graphic say?
Leave a response…

(optional)
Spam Prevention:
 
Augustine_bae7039a

Augie Bae, NMLS MLO#: 203541

Federal Way, WA

More about me…

Landmark Professional Mortgage Company

Address: 2505 S 320th St. Suite 410, Federal Way, WA, 98003

Office Phone: (206) 212-6264

Cell Phone: (206) 849-1535

Email Me



Links

Archives

RSS 2.0 Feed for this blog