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The average mortgage payment is $2,883 for a 30-year fixed mortgage and $3,759 for a 15-year fixed mortgage, but according to the U.S. Census Bureau, the median payment is likely a more accurate indicator for many people, which will be $1,775 in 2022. Be sure to also consider other expenses you'll have to pay each month, like insurance, property taxes, utilities and HOA fees.
According to Insider calculations using data from the U.S. Census Bureau, Department of Housing and Urban Development, Freddie Mac and the National Association of Realtors, the average mortgage payment is $2,883 for a 30-year fixed mortgage and $3,759 for a 15-year fixed mortgage. Detailed calculations are available at the end of this article.
However, the average can be skewed by unusually low or high payments, meaning it often isn't the most accurate representation of what the typical U.S. homeowner actually pays. A better indicator of this is the median, which represents the number in the middle of the dataset.
According to the latest data from the Census Bureau's 2022 American Community Survey, the average monthly cost of homeownership in the U.S. is $1,775. This cost includes not only the monthly mortgage payment but also other necessary expenses like homeowners insurance, HOA fees, and property taxes.
Below, we break down the median prices by state, city, and year.
Mortgage payments by state
While some states have relatively low home prices, states like California, Hawaii, and New Jersey have much higher home prices and therefore higher monthly mortgage payments for people. Mortgage interest rates also vary from state to state.
According to data from the 2022 American Community Survey, homeowners pay an average of $1,775 per month for a home, which includes mortgage payments as well as homeowner's insurance, property taxes, utilities and, if necessary, HOA fees.
Here's a comparison of the 50 US states:
Mortgage payments by city
Especially in coastal cities where space is at a premium, monthly housing payments can be much higher than the national average or median. According to U.S. Census Bureau data from the 2022 American Community Survey, the median monthly housing payment (including utilities, insurance and HOA fees) was more than $3,200 per month in Los Angeles and nearly $3,000 per month in New York City.
But not all cities are so expensive. In Phoenix, Arizona, the median housing cost is $1,642 per month, while in Philadelphia it's less than $1,500 per month. Here are the monthly costs of living in the most populous cities, according to Census Bureau data. Cities are listed by size:
Annual mortgage payment
The average cost of homeownership has increased every year since 2010. The median monthly mortgage payment has increased by about $280 per month from 2010 to 2022.
According to data from the American Community Survey, here's how costs have changed over the past eight years:
Costs included in monthly mortgage payments
According to data from the Census Bureau's American Community Survey, monthly mortgage payments include things like insurance and taxes because homeowners typically pay more than just loan principal and interest in their monthly payments.
If your mortgage includes an escrow account, you'll pay two fees each month with your monthly mortgage payment:
Property Taxes: Pay taxes on your home to state and local governments, as required. If your mortgage includes escrow, this cost will be included in your monthly payments. Home Insurance: To insure your home, you'll need to purchase homeowners insurance. The average cost of homeowners insurance is about $1,400 per year.
Your monthly mortgage payment also depends on how much you borrow and how much your mortgage lender charges for that amount. Here's how these two factors can make your monthly payment go up or down:
Down payment amount: Like other types of loans, mortgages require a down payment. If you don't have 20% down payment on the home you want to buy, private mortgage insurance (PMI) will increase your monthly mortgage payment. The more you put down, the lower your monthly mortgage payment will be. Mortgage interest rate: The amount of interest you pay on your mortgage will affect your monthly payment. Interest rates vary depending on your credit score, where you live, and the type of loan you get.
Another monthly cost to consider is how much you need to save for repairs. Generally, the older the home, the more money you'll need to save for repairs. Utilities like internet, trash disposal, and electricity also add to the monthly cost of homeownership.
Average mortgage payment FAQs
According to Insider calculations based on the most recent data, the average borrower taking out a mortgage in 2023 will have monthly payments of about $2,883 for a 30-year fixed-rate mortgage and $3,759 for a 15-year fixed-rate mortgage.
A $2,000 mortgage is lower than the average monthly payment in the United States, but higher than the median monthly payment. Whether it's high or not depends on what you can afford. If you can afford to pay $2,000 per month and still comfortably cover your other necessities and financial goals, this may not be a very high mortgage for you. But everyone has a different budget.
Most major forecasts expect mortgage rates to continue to fall throughout 2024. It's possible that rates could fall closer to 6% or even below by the end of the year.
According to the 28% rule, you should not spend more than 28% of your monthly gross income on your mortgage. If your annual income is $70,000, your monthly gross income is $5,833. This means your monthly mortgage payment should be $1,633 or less. The price of a home you can buy for $70,000 a year depends on your credit profile, the amount of your down payment, interest rates, and taxes and insurance. With a 6% interest rate and monthly taxes and insurance of $400, you could potentially get a mortgage of up to $200,000.
Methodology: How the averages are calculated
To determine how much the average borrower pays for a mortgage each month, we used the average home sales price based on data from the Census Bureau and the Department of Housing and Urban Development. The average price for Q3 2023 was $513,400. We then used the average down payment of 14% (as reported by the National Association of Realtors) to determine the average loan amount. We also used the average mortgage interest rate for December 2023 from data from Freddie Mac. This average estimate does not include taxes and insurance, as these expenses vary widely.
Liz Knoeven
Personal Finance Reporter
Molly Grace
Mortgage Reporter
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