There’s nothing interesting about interest rates these days — and a recent TikTok video specifically lays out why that is.
A couple named Sarah and Teddy purchased a home in Brooklyn back in 2021. Their timing was right, the clip continues, because they’re now grappling with the sobering realization that their once-affordable abode would cost them double in monthly payments if they were to buy it today.
Reflecting on their fortunate purchase, Sarah says, “When we bought a house in Brooklyn, New York in 2021, we knew we got a killer deal and that we were super lucky, never having purchased a home before. I actually didn’t understand how lucky it was.”
The couple’s stroke of luck stemmed from snagging their dream home for $1.04 million. Sarah, who appears in the clip, didn’t respond to a message seeking comment — and it isn’t clear where in the borough the townhouse is located.
Despite a Zillow appraisal slightly lower at $980,000, the market had yet to catch up with the current interest-rate frenzy that’s now taking a real bite out of many Americans’ wallets.
Sarah adds, “We ended up being able to put 15% down in New York City. Twenty percent is pretty standard, and you’re often competing with people who are putting way more down or all cash offers.”
And that low appraisal required dipping into their savings to cover the difference.
“Because our house appraised low, we had to pay the difference in cash, so that 15% really helped us. So our actual mortgage amount was for $880,000,” Sarah adds.
But the real stroke of luck came with their mortgage rate — an enviable 2.125% for a 30-year term. Thanks to that, their monthly cost, with mortgage and taxes combined, is $3,131 monthly.
“If you know anything about New York City, you know that having an entire house for $3,100 a month is absolutely crazy,” Sarah adds.
Fast forward to today, and the landscape is vastly different.
Sarah painted a stark picture, saying, “If we were to buy this house today, conservatively, it would be about $1.3 million.”
With prevailing mortgage rates hovering around 6.655%, their once-manageable monthly payment would balloon to a staggering $6,680 — more than double what they currently pay.
“This is the same house in a very short period of time, not even taking into consideration any of the improvements we’ve made,” Sarah adds.
Needless to say, Sarah and Teddy have no intentions of leaving their cherished home.
“We’ll be staying here forever. Not only do we love it, but we definitely can’t afford to buy something else,” Sarah says.
Meanwhile, the two have been in the process of renovating and transforming their forever home, documenting their journey on social media.