Rising gas prices affect Federal Way home buying power.
As we move toward Summer, keep in mind that the rising gas prices will affect your ability to purchase a Federal Way, WA home. How you ask? Read this great explaination from Augie Bae, a loan officer with Landmark Professional Mortgage Company.
Imagine how much more buying power has been lost since today's average gas price is $4.03 per gallon in the Federal Way area! I bet those $250,000 Federal Way buyers he references can now only afford $230,000.
Rising gas prices - Can that affect a buyer's price range
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!!
If you are looking to buy or sell a home in the greater Federal Way, WA area, I would be happy to give you more information on today's real estate market. It just might surprise you!
Call, text, or email me. Debi Braulik 206-949-4785 or deborah@kingpiercehomes.com.
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