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Over the past year, U.S. home prices have risen about 6% as the housing market recovery continues. One of the main reasons for the increase has been low inventory of houses for sale, particularly lower-priced homes for first-time buyers. But buyers lucky enough to find a home are making mortgage payments about 10% higher than they would have paid last year.

Mortgage rates have risen about half a percentage point year over year, even though they remain low historically, hovering around 4.000% to 4.125% and while inflation remains low — below 2% — it still adds up.

CoreLogic calculates a “typical mortgage payment” as the mortgage-rate-adjusted monthly payment based on each month’s U.S. median home sale price. It is calculated using Freddie Mac’s average rate on a 30-year fixed-rate mortgage with a 20 percent down payment. It does not include taxes or insurance. The firm says that this typical payment is a good proxy for affordability because it shows the monthly amount that a borrower would have to qualify for in order to get a mortgage to buy the median-priced U.S. home. When adjusted for inflation, the typical mortgage payment also puts current payments in the proper historical context.

Citing an estimate from research firm IHS Markit for a mortgage rate increase of about 70 basis points between August 2017 and August 2018, CoreLogic offers the following estimate:

The CoreLogic Home Price Index forecast suggests the median sale price will rise about 3.0 percent in real terms over the same period. Based on these projections, the inflation-adjusted typical mortgage payment would rise from $816 this August to $908 by August 2018, an 11.3 percent year-over-year gain. Real disposable income is projected to rise about 3.6 percent over the same period, meaning next year’s homebuyers would see a larger chunk of their incomes devoted to mortgage payments.

For more details, visit the CoreLogic Insights Blog.