ARM vs Fixed Rate in New Hampshire
With New Hampshire's median home at $450,000 and conforming limit at $726,200, choosing between an ARM and a fixed-rate mortgage comes down to your time horizon and risk tolerance. Southern New Hampshire has become an extension of the Greater Boston housing market, with prices up 40-50% since 2020. Manchester and Nashua are key feeder markets for Boston commuters and remote workers.
When an ARM May Make Sense in New Hampshire
- You plan to sell or refinance within 5-7 years
- You're buying in a high-cost New Hampshire market where even a small rate reduction meaningfully lowers payments
- Rates are at cyclical highs and expected to fall — ARM initial rates can be 0.5-1% lower than fixed
When Fixed Rates Win in New Hampshire
- You plan to stay long-term (10+ years)
- Payment certainty matters more than short-term savings
- New Hampshire's property taxes (1.93%, avg $6,097/year) add enough payment variability without adding rate risk
Closing Costs
Either product incurs similar closing costs (~$4,100 in New Hampshire). Frequent refinancing to escape an ARM adds these costs repeatedly.
Frequently Asked Questions
Is an ARM or fixed mortgage better in New Hampshire?
It depends on how long you plan to stay. New Hampshire's median home of $450,000 with a 5/1 ARM can save on initial payments, but fixed rates offer certainty — especially important given New Hampshire's property tax rate of 1.93% adds its own payment variability.
What are conforming loan limits for ARMs in New Hampshire?
ARMs and fixed-rate loans both have the same conforming limit in New Hampshire: $726,200. Rockingham and Strafford counties may qualify for high-cost treatment in certain years. Most NH counties are at the standard conforming limit.
How much can I save with an ARM in New Hampshire?
ARM initial rates are typically 0.5-1% below 30-year fixed rates. On a $360,000 loan (20% down on New Hampshire's median home), that's roughly $100-200/month in savings during the initial period.
What are closing costs for a mortgage in New Hampshire?
New Hampshire charges a real estate transfer tax of $1.50/$1,000 of sale price, split equally between buyer and seller. While moderate, the state's high property values mean total closing costs can be substantial. Budget approximately $4,100 in total closing costs for either an ARM or fixed-rate mortgage in New Hampshire.