Volatile mortgage rates are changing what some
potential home buyers can afford from week to week, requiring a
smarter way to shop
- Zillow's new app filter allows shoppers to search for homes by
a range of all-in monthly mortgage costs instead of list
prices.
- Updated mortgage rates feed into the filter, meaning search
results will stay within a shopper's budget, regardless of how
rates or prices move.
- Monthly mortgage costs rose by $431 over the past year, often swinging by more
than $100 per month.
SEATTLE, April 10,
2023 /PRNewswire/ -- Zillow® has a new way to shop
that helps buyers navigate a rapidly changing market and find homes
that fit their monthly budget. The new filter shows homes within a
range of all-in monthly costs, instead of list prices. This monthly
cost includes principal and interest, as well as estimates for
insurance costs, taxes and HOA fees, clarifying a chief source of
confusion for buyers.
Shoppers can use the monthly payment filter now on the Zillow
app.
Last year's drastic rise in mortgage rates sent monthly costs
for home buyers skyrocketing — nearly $700 more than the year before in recent months —
and are now $431 higher than in
March 20221. High rates
combined with record-breaking home appreciation have nearly doubled
monthly mortgage costs since 2020.
Rates are also extraordinarily volatile. Home prices nationwide
started falling in June and flatlined this year, but shifting
mortgage rates often swung costs by more than $100 month to month.
"Shoppers looking at list prices struggle to figure out what
they can really afford, because the mortgage rate is what makes or
breaks a monthly payment. Adding in costs like taxes, insurance and
HOA fees can quickly bust a shopper's budget," said Amanda Pendleton, consumer finance expert at
Zillow Home Loans. "This new search tool does the math, so shoppers
can confidently jump into finding a home they love and can
afford."
Shoppers can start with Zillow's linked affordability
calculator, entering their down payment amount, income and debts to
estimate the monthly mortgage cost they can afford. Then they enter
their monthly budget range into the filter to start shopping.
Updated mortgage rates feed into the filter, showing homes and
hiding others to keep shoppers on budget as rates and price cuts
change the monthly payment math.
A new survey from Zillow Home Loans finds that the most
difficult financing activity among prospective home buyers is
understanding all costs associated with a mortgage payment,
followed by figuring out how much home they can afford, and
researching mortgages and rates.
"Fast-rising mortgage rates last year pushed monthly costs up
with unprecedented speed, dragging affordability to its lowest
point in more than 20 years," said Orphe Divounguy, senior
macroeconomist at Zillow Home Loans. "Beyond the high costs,
volatile mortgage rates have made it extremely difficult to plan
and budget to buy a house."
The new filter — coming soon to Zillow.com — is the latest
Zillow technology helping buyers navigate a challenging
affordability landscape. Down payment assistance that's built
into listings — letting shoppers see what's available for them
where they are looking — as well as mortgage and affordability
calculators, can all help buyers make sense of the fast-moving
market.
Although typical home values peaked in June before tapering off,
mortgage rates that reached 20-year highs later in the year caused
monthly mortgage payments to peak in October, Zillow data
shows.
1 The monthly mortgage cost for a home priced at the
Zillow Home Value Index for the United
States, with a 5% down payment, at the average mortgage rate
for that month and not including insurance and taxes.
About Zillow Group
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate
to make it easier to unlock life's next chapter. As the most
visited real estate website in the United
States, Zillow® and its affiliates offer customers an
on-demand experience for selling, buying, renting, or financing
with transparency and ease.
Zillow Group's affiliates and subsidiaries include Zillow®;
Zillow Premier Agent®; Zillow Home Loans™; Zillow Closing
Services™; Trulia®; Out East®; StreetEasy®; HotPads®; and
ShowingTime+™, which houses ShowingTime®, Bridge Interactive®, and
dotloop®. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS
#10287 (www.nmlsconsumeraccess.org).
(ZFIN)
View original content to download
multimedia:https://www.prnewswire.com/news-releases/zillows-new-search-tool-helps-buyers-find-homes-they-can-afford-301792779.html
SOURCE Zillow