This first of its kind personalized tool will
change how buyers shop for homes
SEATTLE, Nov. 19,
2024 /PRNewswire/ -- Home shoppers now have a way to
instantly understand if a home on Zillow fits within their budget.
BuyAbility is an affordability tool from Zillow Home Loans that
gives buyers a real-time, personalized estimate of the home price
and monthly payment they can afford, and their likelihood of
qualifying for a loan. Instead of wasting time on homes they can't
afford, shoppers can now clearly and quickly identify homes on
Zillow within their true budget.
BuyAbility is the tool for this moment. Homeownership can feel
out of reach for aspiring first-time buyers who are daunted by
today's high prices and may not feel ready to share their personal
financial details with a loan officer. Volatile mortgage rates have
made it difficult to know how much home they can afford, and their
ability to qualify for a loan can change from day to day.
BuyAbility is powered by real-time mortgage rates from Zillow Home
Loans, and makes updates whenever rates move up or down, or when a
prospective buyer improves their credit score, their debt-to-income
ratio or saves more for their down payment.
"Mortgage rates have been on a wild ride this year," said Orphe
Divounguy, a senior economist for Zillow Home Loans. "With
improving inflation numbers and more balanced economic activity,
mortgage rates could ease slightly heading into the new year. That
will mean more affordability and more options for home shoppers.
Buyers will be in a stronger position to act quickly when the right
home enters their BuyAbility, bringing them one step closer to the
American Dream of homeownership."
Shoppers can access BuyAbility from the Home Loans tab on the
Zillow app. They enter their basic financial information, including
their income, credit score, monthly debt payments, amount saved for
a down payment and the amount they're comfortable spending each
month. Within seconds, they get their BuyAbility: an estimate of
the home price they are likely to qualify for, and a suggested
budgeted maximum price based on their desired monthly payments.
When they browse Zillow, listings will be clearly tagged when they
are within that shopper's BuyAbility, providing instant clarity on
whether they are likely to qualify for a loan on that
home.
BuyAbility accounts for the one major factor that basic mortgage
calculators neglect: the interplay between mortgage rates and a
buyer's personal financial situation. Shoppers with higher credit
scores or a lower debt-to-income ratio will qualify for a lower
mortgage rate, which has a huge impact on their buying power.
Assuming a 20% down payment and a fixed-rate mortgage, a
median-income household would be able to afford a $380,000 home with a 7% mortgage rate. That same
household could afford the monthly payments on a $420,000 home with a 6% mortgage rate.
A vast majority of home buyers today are prioritizing budget
above all else. Zillow data finds nearly 80% of recent buyers say
it is very or extremely important to find a home within their
initial budget (79%). That became a bit easier when mortgage rates
dropped this fall. New Zillow research finds the share of homes
that a middle-income household could comfortably afford hit a
nearly two-year high in September. A household making the median
U.S. income could comfortably afford 27.3% of homes listed for sale
across the country. Only 22.7% of all homes listed for sale were
affordable to a middle-income household when mortgage rates peaked
above 7% in May.
That significant shift shows how quickly homes can go from being
unaffordable to affordable in today's market. BuyAbility gives
shoppers a competitive edge by keeping them up to date on exactly
what they can afford at any given time.
BuyAbility is currently available in every state but
New York on the Zillow app and
will be coming soon to desktop computers on Zillow's
website.
About Zillow Group:
Zillow Group, Inc.
(Nasdaq: Z and ZG) is
reimagining real estate to make home a reality for more and
more people. As the most visited real estate website in
the United States, Zillow
and its affiliates help people find and get the home they
want by connecting them with digital solutions, dedicated partners
and agents, and easier buying, selling, financing and renting
experiences.
Zillow Group's affiliates, subsidiaries and brands include
Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Trulia®, Out
East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce® and
Follow Up Boss®.
All marks herein are owned by MFTB Holdco, Inc., a Zillow
affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS
#10287 (www.nmlsconsumeraccess.org). © 2023 MFTB Holdco, Inc., a
Zillow affiliate.
(ZFIN)
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SOURCE Zillow Group, Inc.
