Higher prices, higher rates: The 1st-time homebuyer squeeze

It's never easy buying your first home. But in the past year, it's gotten a lot harder.

NEW YORK (CNNMoney.com) -- What a difference a year makes when you're in the market for a new home, especially if you're a first-time buyer.

Thanks to a combined jump in mortgage interest rates and home prices, a starter home in many areas of the country could cost you several hundred dollars more per month today than if you bought it last year.

Housing Don'ts
If total cost of owning each month exceeds by 25% or more the cost of renting, you may be better off renting.
Spend no more than 30% of gross income on housing.
Nationwide, median home prices rose at annual rate of more than 10 percent in the first quarter of 2006, according to the National Association of Realtors.

Meanwhile, rates on adjustable rate mortgages, the most common for first-time buyers, are up more than a percentage point.

The rate of home-price gains varies widely from market to market. In Gainesville, Fla., for instance, the median sales price of existing family homes rose 31 percent, or about $50,000, to $210,100 between the first quarter of last year and the first quarter of this year, according to NAR.

The percentage gains were more muted - but still high - in richly-priced markets like the New York City-Northern New Jersey area, where the median price rose 11.2 percent to $458,500, an increase of about $46,000.

So for the first-time home buyer in Gainesville or New York, those price and rate increases can mean an extra $400 to $450 in monthly payments to own a home. That assumes you put down the same amount this year on the home as you would have last year.