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Priced Out: Where Higher Rates Could Hurt Home Buyers Most

By Suzanne Woolley - 2014-01-09T16:47:41Z

Photograph by Santa Rosa Press Democrat/Zuma Press

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Pain at 5%: Santa Rosa, Calif.

Monthly income devoted to mortgage bill:

• historic average: 32.2%

• at 5% interest rate: 40.3%

Wine country has always been popular, but with prices in the Sonoma area rising quickly, it's become more and more expensive to live among the vineyards. A 5 percent rate will send the percentage of monthly income needed to pay the mortgage to 40.3 percent. A 6 percent mortgage ratchets that up to 45 percent. That'll make it tough for anyone making around the city’s median income of $59,356 to afford a home. The median value of a home here, which was $423,600 in September of last year, is expected to gain 9.5 percent by this September.