Alaska mortgage rates and home prices tend to be higher than average when compared to interest rates for the rest of the country. However, rates recently reached an all-time low, making it a good time to buy or refinance a home in Alaska.
Current Alaska Mortgage and Refinance Rates
Compare today’s average mortgage rates in the state of Alaska, based on an aggregated pool of rates from multiple sources.
|Product||Rate||Rate Last Week|
|30-Year Fixed Rate||3.000%||2.880%|
|15-Year Fixed Rate||2.500%||2.500%|
|30-Year Jumbo Mortgage Rate||3.000%||2.880%|
|30-Year Fixed Refinance Rate||2.880%||2.810%|
Rates data based on Anchorage, Alaska as of 9/24/2020
Note: Not sure how much house you can afford? Use our mortgage calculator to find out.
Alaska is one of the more expensive places to live in the country based on mortgage rates and home prices. A 2019 study of mortgage rates by state found the average interest rate was 4.84%. Alaska’s was 4.86%, ranking the state #32 when states were ranked lowest to highest for mortgage rates.
Home prices in Alaska are also higher on average when compared to other states. According to the U.S. Census Bureau, the median value of owner-occupied housing units from 2014 to 2018 in the U.S. was $204,900. In Alaska, it was $265,200.
Getting a mortgage in Alaska
According to Madden Real Estate in Alaska, getting a mortgage for a home in the state has similar requirements to other states. A down payment of between 3% to 20% is required. You may be able to qualify for an FHA mortgage with a credit score as low as in the 680s. Employment history will be an important factor when lenders are deciding to approve you for a mortgage.
The Alaska Department of Labor Workforce Development measures the Alaska Affordability Index, which is the number of average paychecks required to afford an average single-family home. In the fourth quarter of 2019, the affordability index was 1.15, a near-low since 1992, coming in second only to 1.14 in 2013.
- Median home price: $265,200
- Average 30-year fixed rate: 3.69%
- Median monthly mortgage cost: $1,907
- Homeownership rate: 64%
Alaska state mortgage rate trends
Mortgage rates in Alaska have been on a downward trend since 1992. According to the Alaska Department of Labor Workforce Development, the mortgage rate in the first quarter of 1992 was 8.62%. In the fourth quarter of 2019, it was 3.74%.
One factor affecting mortgage rates in Alaska is that there is less demand for housing. According to Alaska Public Media, Alaska’s population decreased for the third year in a row in 2019. With fewer people moving to Alaska and more people moving away from Alaska, there are more homes for sale. The increased supply of homes has the effect of contributing to lower mortgage rates.
Alaska state current mortgage rates
Mortgage rates across the country are extremely low due to factors like the COVID-19 pandemic. While the national average rate for a 30-year loan was 3.060% as of Aug. 10, in Alaska, it’s much lower at 2.88%.
For a 15-year fixed mortgage, the Alaska rate is 2.25%. For a 15-year refinance, the rate is 2.88% in Alaska as of Aug. 10. Rates in Alaska are expected to continue to match the declining rates the rest of the country is seeing.
Most and least expensive places to live in Alaska
According to the Alaska Department of Labor Workforce Development, Juneau, the city and borough, had a two-bedroom average single-family home cost of $385,038. Anchorage and Juneau are the state’s two largest cities and fall in the top five for housing costs.
Niche.com ranks the 2020 counties with the lowest cost of living in Alaska. Typically, less densely populated places show up in the list, with the five least expensive counties all having less than 10,000 residents. Kusilvak Borough, which Niche.com ranks as having the least expensive cost of living, has a median home value of $76,000, according to the site.
- Juneau, City and Borough: $385,038 is the average cost of two-bedroom average single-family home.
- Kodiak Island Borough: $374,000 is the average cost of two-bedroom average single-family home.
- Anchorage, Municipality: $366,803 is the average cost of two-bedroom average single-family home.
- Ketchikan Gateway Borough: $346,450 is the average cost of two-bedroom average single-family home.
- Bethel: $345,517 is the average cost of two-bedroom average single-family home.
5 least expensive
- Kusilvak Borough: $76,000 is the median home value.
- Yukon-Koyukuk Borough: $77,700 is the median home value.
- Prince of Wales-Hyder Borough: $172,700 is the median home value.
- North Slope Borough: $143,000 is the median home value.
- Southeast Fairbanks Borough: $184,000 is the median home value.
Alaska state mortgage resources and intricacies
The Alaska Housing Finance Corporation has several resources for homebuyers in the state. With an Affordable Housing Enhanced Loan, borrowers can get secondary financing from a government agency, regional housing authority or nonprofit agency. Alaska offers an Energy Efficiency Rate Reduction for financing new or existing energy-efficient homes or when borrowers make energy improvements to a home.
There is also an interest rate reduction for low-income borrowers available, as well as a 1% interest rate reduction on the first $50,000 of the loan amount for qualified veterans. There’s also a Closing Cost Assistance loan, which provides assistance for up to 4% of the initial principal balance of the loan.
The Alaska Housing Finance Corporation offers two loans for first-time homebuyers: First Home and First Home Limited. Both loans provide lower-than-average interest rates to qualifying buyers.
Alaska tends to fall toward the middle for property tax rates. As of 2019, the property tax rate was 1.02% in Alaska, which was higher than 28 other states. Per capita property taxes were $2,001.43, which is the 11th highest in the United States. One perk to buying a home in Alaska is that you’re not required to pay a real estate transfer tax during the closing process.
The application process to get a mortgage or refinance a home in Alaska doesn’t have any stark differences compared to most other states. Your work history, credit and income can all influence rates and approval.
The final word
Purchasing a home in Alaska is typically more expensive than the average costs you’d encounter elsewhere due to more expensive home costs and higher costs of living throughout the state. Generally, wages in Alaska tend to be higher in areas where homes cost more, too. You can take advantage of mortgage reductions and affordable housing options to help lower your costs when home shopping in Alaska.