Zillow Launches “BuyAbility” Tool For Home Shoppers

Zillow Home Loans launched a new tool to help buyers gauge whether they can afford a home. Users input their income, credit score, and monthly budget. BuyAbility then offers buyers a real-time estimate of the price and monthly payment on a home they’re considering, personalized to their specific budget. It also gives users an idea of whether they could qualify for a loan on a specific property. The program operates on real-time mortgage rates from Zillow Home Loans, so users can check back regularly to see how their finances stack up as the market changes. “What many people don’t realize is that your mortgage rate is highly dependent on your credit score. The better your credit score, the lower the…

Metros With Fewer Mortgages See Less Rate Lock-In

Inventory is doing best in cities with fewer mortgages and older homeowners, reinforcing the impact of high interest rates on the market. That’s according to a new report from Zillow, which found that metros where more homes are owned outright are seeing the fastest growth in new listings. Pittsburgh, Buffalo, and Cleveland have the highest share of homeowners free from rate lock-in.  Generationally, Baby Boomers are the most likely not to be impacted by mortgage rates when deciding to purchase a home. That’s compared to just 6% of Millennial homeowners. More than 10 million homeowners are mortgage-free and could afford monthly payments if they decided to move today. This demographic skews older and tends to live in more affordable markets,…

St. Louis Is The Best City For First-Time Buyers

First-time homebuyers will find the best mix of affordability, low competition, and young homeowners in Midwestern metros, a new report says. Zillow named the best markets for first-timers in 2024, with St. Louis taking the number one spot. Detroit, Minneapolis, Indianapolis, and Austin rounded out the top five. These cities offer reasonable prices and a relatively full arsenal of starter homes to choose from. Low-priced properties have been hard to come by due to rate lock-in keeping many families from moving up and a tendency for builders to produce big homes. That trend is changing, with builders now prioritizing smaller homes with fewer amenities, but until the construction wave is complete, first-time buyers need to prioritize metros that offer affordable…

Million-Dollar Cities Surge In The U.S.

“Million-Dollar Cities” took even more share in the U.S. as inventory keeps home prices moving up. There are 550 cities where the typical home value is $1 million or more, up from 491 last year, according to a new Zillow report. Home prices were depressed some last year as Americans adjusted to rising rates but have rebounded since the beginning of the year, with many metros clocking new record highs. Most of these affluent areas are in California, which boasts 210 cities, more than the next five states combined.  New York and New Jersey took second and third place, but the NYC metro area – which includes parts of Jersey and Pennsylvania – would take first for most additions. There…

The Spotlight Is On Buffalo, NY

By ERIN FLYNN JAY In recent years, cities in warmer weather states have boasted the nation’s hottest housing markets but now the spotlight is on one of the snowiest places in the country. Last month, Zillow released its annual predictions for the hottest housing markets of 2024. Buffalo, NY, took spot number one based on its affordability. The predictions are based on an analysis of home value growth, recent housing market activity, projected changes in the labor market, home construction activity, and the number of homeowner households in the top 50 metropolitan areas according to population. Buffalo makes homeownership a real possibility, especially for younger generations looking to purchase their first home. The average home price came in at $248,445,…

Pending Home Sales Fell Off In January

Pending home sales contracted in January as rate-sensitive buyers skipped out despite increasing inventory. NAR’s Pending Home Sales Index fell by 4.9% month-over-month to a reading of 74.3 in January. An index of 100 is equal to the level of contract activity in 2001. Year-over-year, they were down 8.8%. “The job market is solid, and the country’s total wealth reached a record high due to stock market and home price gains,” said NAR Chief Economist Lawrence Yun. “This combination of economic conditions is favorable for home buying. However, consumers are showing extra sensitivity to changes in mortgage rates in the current cycle, and that’s impacting home sales.” All four U.S. regions saw declines in year-over-year sales, while month-over-month sales actually…

Zillow Names Buffalo Hottest City Of 2024

Buffalo, NY, is slated to be the hottest market of 2024 as affordable metros gain popularity among money-minded Americans. Cincinnati and Columbus took numbers two and three on Zillow’s Hottest Markets of 2024 list, driving home the importance of savings for homebuyers this year. The list is made up of relatively low-cost cities, primarily in the Midwest and South. Indianapolis, IN; Providence, RI; Atlanta, GA; Charlotte, NC (2023’s hottest city, now in 7th place); Cleveland, OH; Orlando, FL, and Tampa, FL, rounded out the top ten. Zillow’s analysis looks at the 50 most populous metros and measures local home value growth and the speed at which home sellers are entering contracts with buyers, as well as job growth per new…

Buyer Demand Elevated Despite Affordability Concerns

Even as buying a home is getting more expensive by the day, stock shortages are spurring serious competition among the few buyers on the market. New listings fell nearly 5% last month, according to Zillow’s latest market report. While inventory is slowly recovering – 5% is actually a smaller decline than seasonally expected – it is still the lowest number of listings in any October recorded by Zillow since 2018. Still, there are good indicators for inventory. Listings were down 1.2% YOY, the smallest since May 2022, and are down 19% compared to pre-pandemic levels, much better than April’s -35%. In fact, total inventory actually rose 2.6% from September to October, though this was due to a downturn in sales,…

Communities Of Color Still Face Barriers To Homeownership

Disturbing new research from Zillow shows how Americans without access to credit are blocked out of homeownership, especially in Black neighborhoods. Lack of access to credit keeps many renters stuck in the same routine and paying more than they would if they purchased a home. Zillow notes that in many parts of the country, monthly mortgage payments are less expensive than rent. But credit insecure areas tend to have higher populations of color, especially Black households. The lack of access can be directly tied to racist banking practices that permeated the 20th century. Redlining is an illegal practice where lenders avoid providing credit services to individuals living in communities of color because of the race, color, or national origin of…

Home For The Holidays: Will It Be Better To Buy At Thanksgiving Or Christmas?

By ERIN FLYNN JAY Holiday home shoppers who are sensitive to mortgage interest rates near 8% may resist the idea of buying before Thanksgiving, hoping that Santa Claus brings relief, but is waiting until Christmas the answer this season? On Wednesday, the Federal Reserve held its target range for the federal funds rate at 5.25% to 5.5%, and mortgage rates slipped in anticipation of the news. But Orphe Divounguy, senior macroeconomist at Zillow Home Loans, warned that investors will likely recalculate their inflation forecasts based on employment and wage growth data, “causing large swings in mortgage rates.” That means uncertainty for homebuyers. Matt Ronne, senior loan officer with Motto Mortgage Preferred Brokers in Athens, TN, said that this year, with…