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Monthly Housing Costs Over Time, Plus Adjusted For Inflation |
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 Above you can track average monthly housing costs in Harrisonburg and Rockingham County over time, with some pretty large caveats. This graph is based on the median sales price each year, assuming a buyer finances 80% of the purchase price with the average mortgage interest rate of that year, and the monthly costs include an estimate for insurance and property taxes. This chart is not showing the average housing cost of everyone in Harrisonburg and Rockingham County over time -- it is showing the monthly housing costs for buyers buying homes in each of the years in the graph. If you bought a home in 2014 with a fixed rate mortgage, your housing costs have likely stayed relatively level over the past decade other than adjustments for insurance costs and real estate taxes, both of which are a minority of the total housing cost. You might note that this graph shows monthly costs spiking significantly between 2021 and 2024. In fact... they nearly double between 2020 and 2024. Here's where we need to consider inflation. The inflation rate was quite higher in 2021 and 2022 which caused housing costs (and the cost of many other items) to increase significantly. Certainly mortgage interest rates were also rising during this time, but we can't ignore the impact of inflation alone. Here is the annual inflation rate during the same timeframe as in the graph above...  And now, let's adjust those housing costs for inflation, so that each year's housing cost is in 2020 dollars, to see how much housing costs have adjusted over time over and above how inflation has changed...  Here you can see that housing costs have still increased quite significantly over the past few years, but not quite as much as the non inflation adjusted data would have you believe. It seems unlikely that home prices are going to decline - so the best bet for housing costs leveling off would be lower mortgage interest rates. Most economists are not predicting significant downward adjustments in mortgage interest rates in 2025. Recent Articles:
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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
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Commonwealth of Virginia
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