The PITI Problem: The Hidden Costs Driving Up Mortgage Payments

Taxes and insurance are quietly taking a bigger bite out of homeowners’ monthly payments—and in some markets, they make up more than a third of housing costs. Tim Lucas and Craig Berry break down new research from Neighbors Bank showing how rising property taxes and insurance premiums are reshaping housing affordability across the country.In this episode you’ll learn:How big the PITI problem has become: In some U.S. markets, property taxes and homeowners insurance account for more than one-third of the average mortgage payment.Where the burden is highest: In the Pensacola metro area, taxes and insurance make up about 43.6% of the typical monthly housing payment.Why these costs are rising: Surging home values increase property taxes, while climate risk and disasters are pushing insurance premiums higher.How location changes everything: Some areas struggle with high insurance costs, while others—like parts of Illinois—face steep property taxes.Why mortgage rates aren’t the whole story: Even with a fixed-rate mortgage, homeowners remain exposed to rising taxes and insurance premiums.What buyers should check before making an offer: Getting insurance quotes and researching property tax trends can prevent costly surprises.Where costs may be more manageable: States with lower disaster risk and less reliance on property taxes may offer more predictable housing expenses.Key takeaway: Looking only at the home price or interest rate can be misleading—understanding the full PITI payment is essential to evaluating true affordability.Read the full article: https://www.mortgageresearch.com/articles/hidden-housing-costs-taxes-insurance-now-take-21-percent-of-average-mortgage-payment/