This Was the Average Mortgage Payment in May. Would It Bust Your Budget?

It may be out of reach for a lot of people.

It's hardly a secret that housing is getting less and less affordable. And when we look at the state of the housing market, it's easy to see why.

Home prices have been sky-high for many months on end, largely due to a glaring lack of real estate inventory. But that's not all.

Since the start of the year, mortgage rates have been on the rise, and at one point in June, the average 30-year mortgage rate topped the 6% mark. Now to be fair, this is by no means the most expensive mortgage borrowing has ever been. But the rates we've seen of late are the most expensive ones in over a decade.

Because home prices are up and borrowing rates are less competitive than they were at the start of the year, mortgage loan applicants are signing up for higher monthly housing payments. And for many people, the typical mortgage payment in May may be financially out of reach.

It's not a small number

In May, the national median mortgage payment home loan applicants signed up for was $1,897, according to the Mortgage Bankers Association. Now, that's comparable to what borrowers signed up for in April. But in March, that figure was much lower at $1,736.

All told, homes are getting harder and harder to afford, especially when we consider that higher property values may also be leading to an uptick in property tax bills. Property taxes are based on homes' assessed values, so the higher those numbers are, the higher one's tax burden can be.

Can you afford to buy a home today?

The amount of money you end up spending on a mortgage payment will hinge on a number of factors. Those include:

• The purchase price of your home
• The amount of your down payment
• The interest rate you manage to snag on a mortgage

There are steps you can take to keep your mortgage payments down, like working on boosting your credit score to snag a more affordable mortgage rate or socking away extra funds for a larger down payment. Opting for a 30-year mortgage will also result in lower monthly payments than a shorter-term loan, like a 15- or 20-year mortgage.

But ultimately, you'll need to make sure your total housing costs don't exceed 30% of your take-home pay. And that doesn't just mean your mortgage payment. Rather, it should include predictable monthly expenses related to housing like property taxes, homeowners insurance, and HOA fees, if those apply to the home you're looking at.

It's important to crunch those numbers and see how much house your paycheck allows for. It may be the case that you end up with a monthly mortgage payment in excess of $1,897, but if you can afford that and you're comfortable taking on that expense, go for it. Or maybe you need to limit your monthly mortgage payment to $1,550 due to your income.

It's helpful to track mortgage payment data to get a sense of what you might be in for. But ultimately, there are many variables that will come into play to determine how much you end up spending monthly on a home. And it's really important to make sure the number you sign up for is one that works for you financially.