Month: April 2017

28 Apr

Renters Can Buy Without Increasing Their Monthly Housing Costs

SEATTLE, April 28, 2017 /PRNewswire/ — Rent is so high that a typical renter in the U.S. can purchase a home nearly 50 percent more expensive than the median valued home and keep the same monthly housing budget, according to a new Zillow® analysis.

The median rent in the U.S. is $1,416 per month, which is enough to cover the monthly expenses associated with owning a $289,505 home. The median U.S. home value is $196,500.

Rent is more expensive than ever before. Affordability is a growing concern across the country, and rent requires almost half of the median income in some of the nation’s most expensive markets. A mortgage payment is cheaper than a rental payment on a monthly basis, but saving enough money for the down payment is holding back many renters from crossing over into homeownership.

Zillow analyzed the median rent payment in cities across the country to determine how much home a prospective buyer could afford without spending more on a mortgage than they were currently spending on rent. Zillow factored in all monthly homeownership costs, such as property taxes, maintenance and insurancei. In 37 of the 50 cities Zillow analyzed, renters could buy a home worth more than the median valued home in their city without spending more on monthly housing costs.

Renters paying the median rent in Cleveland and Milwaukee can afford to buy a home more than twice as expensive as the local median home value. In Cleveland, prospective buyers can buy a home valued at $174,194 while keeping all monthly housing costs the same — this represents more than 80 percent of homes currently on the market.

San Francisco is one of the only cities in the country where a monthly rental payment would not cover the costs of owning the median valued home. Renters in San Francisco who want to keep monthly expenses the same would have to buy a home valued at $865,857, representing just 23 percent of homes currently on the market. The median home value in the city of San Francisco is over $1 million.

“Renters hesitant to enter the home buying market for fear of not being able to find an affordable home should be encouraged to discover they may have more options than they thought,” said Zillow Chief Economist Dr. Svenja Gudell. “However, it’s worth noting that many of the more affordable homes for sale may be older, smaller and/or located in less-desirable neighborhoods than they might like. The decision between buying and renting is a financial trade-off between saving more each month on a mortgage payment versus spending more on rent but taking advantage of the location and lifestyle amenities urban renting often offers. Recent slowdowns in rent growth may take some of the edge off for renters saving to become homeowners. This is good news, since saving a down payment, qualifying for a loan and finding a home available at a manageable price remain hurdles for millions of aspiring buyers.”

Nearly half of all buyers are entering the market for the first-time, according to the 2016 Zillow Group Report on Consumer Housing Trends. The majority of all buyers stay within the same city when they move.

City

 Zillow Rent
Index
ii
(ZRI),
March 2017

 Zillow Home
Value Index
iii
(ZHVI), March
2017

 Value of Home
Affordable without
Increasing Monthly
Housing Costs

Share of
Available
Inventory

United States

$1,416

$196,500

$289,505

56.8%

New York, NY

$2,372

$650,000

$484,962

28.7%

Los Angeles, CA

$2,863

$622,900

$585,348

27.6%

Chicago, IL

$1,650

$220,900

$337,347

57.1%

Philadelphia, PA

$1,218

$136,100

$249,023

71.9%

Phoenix, AZ

$1,256

$208,600

$256,793

40.6%

Las Vegas, NV

$1,245

$212,500

$254,544

47.5%

San Diego, CA

$2,503

$558,600

$511,745

31.3%

Dallas, TX

$1,393

$163,200

$284,803

24.7%

San Jose, CA

$3,310

$862,800

$676,739

28.3%

Jacksonville, FL

$1,171

$148,400

$239,414

59.1%

San Francisco, CA

$4,235

$1,167,200

$865,857

22.8%

Austin, TX

$1,848

$316,800

$377,829

33.2%

Detroit, MI

$751

$  39,100

$153,544

92.2%

Columbus, OH

$1,150

$127,400

$235,121

71.2%

Memphis, TN

$851

$  80,200

$173,989

73.5%

Charlotte, NC

$1,309

$181,200

$267,629

37.9%

El Paso, TX

$998

$113,800

$204,044

64.5%

Boston, MA

$2,634

$542,100

$538,529

23.4%

Seattle, WA

$2,540

$638,100

$519,310

26.5%

Baltimore, MD

$1,301

$124,100

$265,993

79.2%

Denver, CO

$2,000

$377,500

$408,906

31.2%

Washington, DC

$2,635

$559,200

$538,733

45.3%

Nashville, TN

$1,550

$223,800

$316,902

38.8%

Milwaukee, WI

$1,138

$105,700

$232,667

86.0%

Tucson, AZ

$1,080

$162,000

$220,809

48.1%

Portland, OR

$1,895

$414,800

$387,438

31.3%

Omaha, NE

$1,308

$151,700

$267,424

49.4%

Albuquerque, NM

$1,205

$187,500

$246,366

56.8%

Fresno, CA

$1,256

$209,600

$256,793

55.6%

Sacramento, CA

$1,543

$293,600

$315,471

60.5%

Mesa, AZ

$1,289

$219,100

$263,540

47.2%

Long Beach, CA

$2,459

$548,400

$502,749

46.7%

Kansas City, MO

$1,042

$119,400

$213,040

53.6%

Virginia Beach, VA

$1,562

$255,900

$319,355

57.2%

Colorado Springs, CO

$1,425

$246,800

$291,345

32.2%

Atlanta, GA

$1,510

$206,800

$308,724

46.6%

Miami, FL

$2,093

$299,900

$427,920

45.4%

Oakland, CA

$2,973

$676,900

$607,838

52.8%

Cleveland, OH

$852

$  56,300

$174,194

81.9%

Honolulu, HI

$2,438

$671,800

$498,456

36.5%

Minneapolis, MN

$1,617

$231,200

$330,600

50.3%

Baton Rouge, LA

$1,342

$155,800

$274,376

60.3%

New Orleans, LA

$1,377

$173,800

$281,531

47.0%

Arlington, TX

$1,465

$176,000

$299,523

57.0%

Raleigh, NC

$1,400

$221,000

$286,234

28.0%

Wichita, KS

$947

$121,000

$193,617

57.7%

Tampa, FL

$1,347

$182,700

$275,398

46.3%

Anaheim, CA

$2,642

$560,200

$540,164

31.7%

Santa Ana, CA

$2,490

$493,900

$509,087

42.0%

Aurora, CO

$1,783

$281,000

$364,539

56.0%

Zillow

Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ:Z and ZG), and headquartered in Seattle.

Zillow is a registered trademark of Zillow, Inc.

________________________________
i This analysis assumes a 20% down payment, and property taxes of 1% of the home value annually, maintenance costs of 1% of the home value annually, and homeowners’ insurance of 0.5% each year.
ii The Zillow Rent Index (ZRI) is the median Rent Zestimate® (estimated monthly rental price) for a given geographic area on a given day, and includes the value of all single-family residences, condominiums, cooperatives and apartments in Zillow’s database, regardless of whether they are currently listed for rent. It is expressed in dollars. 
iii The Zillow Home Value Index (ZHVI) is the median estimated home value for a given geographic area on a given day and includes the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period. It is expressed in dollars, and seasonally adjusted.

SOURCE Zillow, Inc.

20 Apr

Rents Rise from Slowest Pace in 5 Years

SEATTLE, April 20, 2017 /PRNewswire/ — Rents in the united states rose 0.7 % from final March, the slowest rate of appreciation since November 2012, as new construction begun to meet renter requirement and soften the marketplace. The median rent transaction in the U.S. is currently $1,408, based on the March Zillow® MARKET Reportsi.

Rents within the Bay Region have slowed a lot more than any large metropolitan area in the last year. In San Francisco, rents are down 0.1 % after appreciating almost ten percent annually at the moment this past year. Rents in San Jose were rising at nearly 9 percent annually this past year, but fell 1.1 % in the last year to a median lease transaction of $3,451.

Even in warm West Coast marketplaces, where leasing growth is notoriously solid, rent appreciation is needs to slow. In Seattle, rents are up 6.7 percent, but their speed of appreciation has been slowing since August 2016. Rents in Sacramento are up 4.7 %, but were rising at almost 7 % annually toward the finish of this past year.

Affordability is really a significant concern for renters in the united states, who have experienced increasing rents for years. In lots of major metros, the reveal of income had a need to pay rent properly surpasses the overall rule of not investing more than 30 % of income on casing. In Los Angeles, the median rent transaction takes up almost 1 / 2 of the median revenue, which forces renters to shack up with roommates to make housing less expensive.

“The slowdown within rental appreciating is principally because of new construction finally conference demand, and also outpacing demand in a few areas,” mentioned Zillow’s Chief Economist Dr. Svenja Gudell. “But, rents will be the highest they’ve actually been, weighing seriously on renters’ budgets and rendering it extremely problematic for those renters wishing to become homeowners to save lots of enough cash for a deposit. Generally in most markets, a month-to-month mortgage repayment is more affordable when compared to a monthly rent transaction, however the most difficult facet of home buying for most aspiring property owners is discovering enough cash for the deposit.”

The median home value in the united states is $196,500, up 6.8 percent since this time around last year. Seattle, Tampa, Fla. and Dallas reported the best year-over-year home worth appreciation on the list of 35 largest U.S. metros. In Seattle, house values rose almost 12 % to a median worth of $426,300. Home values in Tampa and Dallas are up about 11 % since this time around last year.

Low inventory is still an issue for home shoppers in the united states — you can find 5 percent fewer houses to choose from when compared to a year back, paving just how for an exceptionally competitive house shopping season.

Minneapolis, Columbus, Ohio and Seattle reported the best drop in inventory on the list of 35 largest U.S. metros. In Minneapolis, you can find 24 percent fewer houses to choose from when compared to a yr ago, and 19.5 percent fewer to select from in Columbus. In Seattle, where home ideals are increasing the fastest, buyers could have 17 percent less homes to pick from when compared to a year ago.

Mortgage rates are lower from their December highs, but nonetheless well above where these were prior to the election. In March, home loan pricesii on Zillow finished at 3.94 %, down from a most of 4.13 %iii. The month low was 3.93 %iv. Zillow’s real-time home loan rates derive from a large number of custom mortgage quotations submitted everyday to anonymous debtors on the Zillow Mortgages web site and reflect the newest changes on the market.

Metropolitan

Area

 Zillow House Value Index[v] (ZHVI)

Year-

over-Year

ZHVI Change

Zillow Lease Index[vi] (ZRI)

Year-

over-

Year ZRI

Change

Year-over-Year

ZRI Alter at

This Time Final

Year

Year-over-

Year

Inventory

Change

United Declares

$                       196,500

6.8%

$             1,408

0.7%

3.3%

-5.3%

New York/

Northern New

Jersey

$                       411,300

7.6%

$             2,386

-1.3%

4.3%

-10.6%

Los Angeles-Long

Beach-Anaheim,

CA

$                       601,900

6.1%

$             2,648

4.4%

4.1%

-7.2%

Chicago, IL

$                       208,400

6.4%

$             1,618

-1.9%

1.6%

-8.7%

Dallas-Fort

Really worth, TX

$                       205,300

11.0%

$             1,569

3.2%

4.6%

5.3%

Philadelphia, PA

$                       216,000

4.4%

$             1,565

0.0%

2.4%

-9.9%

Houston, TX

$                       174,500

3.2%

$             1,544

-2.5%

4.0%

2.7%

Washington, DC

$                       382,900

3.8%

$             2,115

-0.3%

1.4%

-12.2%

Miami-Fort

Lauderdale, FL

$                       249,700

8.7%

$             1,849

-0.6%

5.0%

8.7%

Atlanta, GA

$                       175,800

7.1%

$             1,337

3.2%

4.4%

1.2%

Boston, MA

$                       419,900

7.0%

$             2,351

4.0%

5.4%

-14.0%

San Francisco, CA

$                       843,200

4.4%

$             3,352

-0.1%

9.9%

-1.1%

Detroit, MI

$                       138,700

10.1%

$             1,175

1.2%

3.1%

-14.9%

Riverside, CA

$                       322,700

6.7%

$             1,759

2.7%

3.8%

-13.7%

Phoenix, AZ

$                       232,700

6.4%

$             1,310

2.5%

4.6%

5.0%

Seattle, WA

$                       426,300

11.6%

$             2,106

6.7%

8.0%

-17.2%

Minneapolis-St

Paul, MN

$                       241,900

7.7%

$             1,570

3.4%

2.8%

-24.0%

San Diego, CA

$                       532,000

5.2%

$             2,453

3.4%

4.2%

-10.8%

St. Louis, MO

$                       149,300

6.2%

$             1,137

0.3%

1.9%

-7.5%

Tampa, FL

$                       183,300

11.4%

$             1,351

2.7%

4.5%

-8.9%

Baltimore, MD

$                       259,200

4.0%

$             1,717

-0.8%

1.5%

-15.4%

Denver, CO

$                       362,800

9.5%

$             1,997

0.7%

7.8%

4.5%

Pittsburgh, PA

$                       135,700

4.8%

$             1,067

-4.6%

5.0%

-5.8%

Portland, OR

$                       359,800

7.2%

$             1,805

4.6%

9.4%

6.7%

Charlotte, NC

$                       170,600

7.2%

$             1,250

1.1%

3.1%

-11.4%

Sacramento, CA

$                       361,000

8.2%

$             1,717

4.7%

5.5%

-12.7%

San Antonio, TX

$                       158,500

5.6%

$             1,325

1.4%

2.5%

13.4%

Orlando, FL

$                       202,900

10.0%

$             1,400

3.2%

4.4%

-11.0%

Cincinnati, OH

$                       151,300

6.7%

$             1,254

1.9%

2.2%

-15.6%

Cleveland, OH

$                       132,400

4.7%

$             1,144

1.2%

0.1%

2.2%

Kansas Town, MO

$                       155,600

5.9%

$             1,254

1.5%

5.2%

-10.5%

Las Vegas, NV

$                       219,200

9.9%

$             1,247

1.3%

3.2%

22.8%

Columbus, OH

$                       161,700

4.8%

$             1,296

1.2%

3.3%

-19.5%

Indianapolis, Within

$                       137,300

5.5%

$             1,186

-0.3%

0.8%

-12.8%

San Jose, CA

$                       986,000

3.4%

$             3,451

-1.1%

8.6%

-8.0%

Austin, TX

$                       267,500

7.3%

$             1,691

-0.6%

3.2%

23.5%

About Zillow

Zillow® may be the leading property and rental marketplace focused on empowering consumers with information, inspiration and knowledge round the place they contact home, and linking them with the very best local professionals who is able to help. Furthermore, Zillow functions an industry-top economics and analytics bureau brought by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her group of economists and information analysts produce extensive casing data and analysis covering a lot more than 450 marketplaces at Zillow PROPERTY Research. Zillow furthermore sponsors the quarterly Zillow House Price Expectations Study, which asks a lot more than 100 top economists, property experts and expense and marketplace strategists to predict the road of the Zillow House Value Index on the next five yrs. Launched in 2006, Zillow is possessed and managed by Zillow Team (NASDAQ:Z and ZG), and headquartered in Seattle.

Zillow is really a registered trademark of Zillow, Inc.

i The Zillow MARKET Reports certainly are a monthly summary of the national and local areas. The reports are published by Zillow PROPERTY Research. To find out more, visit www.zillow.com/research/. The info in Zillow’s MARKET Reports are aggregated from public sources by way of a amount of data providers for 928 metropolitan and micropolitan areas dating back to to 1996. Mortgage and mortgage loan data are usually recorded in each county and publicly available by way of a county recorder’s office. All current monthly data at the national, state, metro, city, ZIP code and neighborhood level could be accessed at www.zillow.com/local-info/ and www.zillow.com/research/data.

ii Rates for a 30-year fixed mortgage.

iii Month high occurred on Tuesday, March 14th.

iv Month low occurred on Wednesday, March 22nd.  

v The Zillow Home Value Index (ZHVI) may be the median estimated home value for confirmed geographic area on confirmed day and includes the worthiness of most single-family residences, condominiums and cooperatives, whether or not they sold within a given period. It is expressed in dollars, and seasonally adjusted.

vi The Zillow Rent Index (ZRI) may be the median Rent Zestimate® (estimated monthly rental price) for confirmed geographic area on confirmed day, and includes the worthiness of most single-family residences, condominiums, cooperatives and apartments in Zillow’s database, whether or not they’re currently listed for rent. It really is expressed in dollars. 

SOURCE Zillow

12 Apr

Down Payment Holding Back again Renters from Investing in a Home

SEATTLE, April 12, 2017 /PRNewswire/ — Despite the fact that a home loan payment is less expensive when compared to a rent payment upon a month-to-month basisi, renters say they can not buy a home because of the pricey deposit, based on the first Zillow® Casing Aspirations Report&business; (ZHAR)ii.

Nearly 70 percent of renters surveyed cite the deposit as a larger barrier to homeownership than debt, job security and qualifying for a mortgageiii. Simply over 1 / 2 of renters cite qualifying for a home loan as a barrier to homeownership, and fifty percent say debt is keeping them back again. Almost 40 % of renters say work security is maintaining them from purchasing a home.

The U.S. homeownership price is usually near an all-time low and contains been falling since 2004, although people of the biggest generation of Us citizens — millennials — are coming old and starting to consider buying a house and settling down. Rents may also be at report highs, costing almost 50 % of the median earnings in some cities. Creating a monthly mortgage repayment is cheaper when compared to a monthly rent transaction in every but two of the 35 largest U.S. metrosiv, but first renters have to save enough cash for a deposit.

The Zillow Casing Aspirations Record, a semi-annual survey sponsored by Zillow and conducted by IPSOS, asks 10,000 renters and house owners in 20 metros in the united states about their views on homeownership and their personal casing expectations in the years ahead.

Here are usually some highlights from the record:

  • Over fifty percent (63 %) of renters are self-confident that they will have the ability to afford a house someday, with 25 % planning on buying within the next 3 to 5 years.
  • Millennial renters tend to be more confident than any generation that they can have the ability to afford a house someday, with 34 % thinking about buying in 3 to 5 years. Almost 25 % (22 %) said they intend to buy in a single to 2 yrs and 2 % of millennial renters mentioned they never anticipate investing in a home.
  • The most respondents (66 percent) believe running a home is essential to call home The American Fantasy, and 72 percent believe running a house increases your standing in the neighborhood community — millennials believe both of these statements a lot more than any generation.

With home values in the united states at their highest stage since June 2007, cobbling together a 20-percent deposit on a house costs a lot more than two-thirds of the U.S. median home annual revenuev. In pricier markets like San Jose and Los Angeles, buyers must develop more than 180 % of the median yearly income, creating a home buy out of grab many aspiring home owners.

“With home values near record highs, it’s not surprising renters are worried about discovering sufficient money to buy a house,” said Zillow Chief Economist Dr. Svenja Gudell. “Rising rents may also be one factor — it’s extremely challenging to save if you are paying record-high rents. Although it is possible to place down less than 3 % on a house, the trade-off is really a higher interest and costly private home loan insurance, a economic tradeoff that could make sense for a few purchasers. But with interest levels rising in 2017, it is critical to remember that a lesser interest can save customers thousands over the lifestyle of these loan. For those attempting to conserve for a deposit, it is important to set realistic targets and realize it could take a couple of years. Also, consider dealing with an established financial advisor to greatly help set a spending budget that functions for you.”

San Jose, San Diego and Los Angeles had the best share of renters say affording the deposit is the number 1 barrier to owning, at over 72 percent. Women (72 percent) were much more likely than men (62 percent) to choose the down payment because the top barrier to homeownership.

One-third of buyers used several source of funds because of their deposit, including gifts and loans from family, based on the Zillow Group Report on Consumer Housing Trendsvi. Over 1 / 2 of buyers saved by putting away a little money at the same time.

Mortgage rates on Zillow ended the month of March at 3.94 percent, down from the most of 4.13 percent in the center of the monthvii. Home shoppers may use the Zillow Affordability Calculator to observe how varying loan amounts and down payments will impact monthly premiums and the lifetime balance of these mortgage.

Perceived Barriers to Homeownership in the U.S., Among Renters

Barrier

Percent of Renters Citing Barrier

Affording the Down Payment

67.9%

Qualifying for a Mortgage

53.2%

Debt

50.0%

Job Security

38.5%

Not able to Settle Down

20.1%

Not Enough Homes for Sale

11.2%

None

6.9%

Other

4.1%

Top Three Perceived Barriers to Homeownership Among Renters

Metropolitan Area

Number 1 Barrier

Number 2 Barrier

Number 3 Barrier

United States

Affording DEPOSIT – 67.9%

Qualifying for Mortgage – 53.2%

Debt – 50.0%

New York/Northern New Jersey

Affording DEPOSIT – 56.2%

Qualifying for Mortgage – 48.9%

Debt – 47.7%

Los Angeles-Long Beach-Anaheim, CA

Affording DEPOSIT – 72.2%

Qualifying for Mortgage – 55.0%

Debt – 43.7%

Chicago, IL

Affording DEPOSIT – 69.7%

Qualifying for Mortgage – 52.5%

Debt – 50.6%

Dallas-Fort Worth, TX

Affording DEPOSIT – 65.6%

Qualifying for Mortgage – 54.9%

Debt – 52.5%

Philadelphia, PA

Affording DEPOSIT – 67.5%

Debt – 54.6%

Qualifying for Mortgage – 49.3%

Washington, DC

Affording DEPOSIT – 70.6%

Qualifying for Mortgage – 58.0%

Debt – 53.0%

Miami-Fort Lauderdale, FL

Affording DEPOSIT – 64.7%

Qualifying for Mortgage – 54.6%

Debt – 45.4%

Atlanta, GA

Affording DEPOSIT – 62.3%

Debt – 54.9%

Qualifying for Mortgage – 51.3%

Boston, MA

Affording DEPOSIT – 71.5%

Qualifying for Mortgage – 53.7%

Debt – 43.5%

San Francisco, CA

Affording DEPOSIT – 69.0%

Qualifying for Mortgage – 55.5%

Debt – 49.8%

Detroit, MI

Affording DEPOSIT – 67.6%

Debt – 52.7%

Qualifying for Mortgage – 49.9%

Phoenix, AZ

Affording DEPOSIT – 69.2%

Qualifying for Mortgage – 59.9%

Debt – 51.9%

Seattle, WA

Affording DEPOSIT – 66.0%

Qualifying for Mortgage – 52.8%

Debt – 48.1%

Minneapolis-St Paul, MN

Affording DEPOSIT – 69.4%

Debt – 53.0%

Qualifying for Mortgage – 50.1%

San Diego, CA

Affording DEPOSIT – 72.9%

Debt – 54.4%

Qualifying for Mortgage – 50.7%

St. Louis, MO

Affording DEPOSIT – 70.4%

Debt – 53.5%

Qualifying for Mortgage – 53.2%

Tampa, FL

Affording DEPOSIT – 70.3%

Qualifying for Mortgage – 56.6%

Debt – 51.8%

Denver, CO

Affording DEPOSIT – 65.7%

Qualifying for Mortgage – 52.4%

Debt – 51.4%

Las Vegas, NV

Affording DEPOSIT – 63.0%

Qualifying for Mortgage – 54.8%

Debt – 48.8%

San Jose, CA

Affording DEPOSIT – 73.9%

Qualifying for Mortgage – 48.4%

Debt – 43.7%

About Zillow
Zillow® may be the leading property and rental marketplace focused on empowering consumers with data, inspiration and knowledge round the place they call home, and connecting them with the very best local professionals who is able to help. Furthermore, Zillow operates an industry-leading economics and analytics bureau led by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering a lot more than 450 markets at Zillow PROPERTY Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks a lot more than 100 leading economists, property experts and investment and market strategists to predict the road of the Zillow Home Value Index on the next five years. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ: Z and ZG), and headquartered in Seattle.

Zillow is really a registered trademark of Zillow, Inc. Housing Aspirations Report is really a trademark of Zillow, Inc.

IPSOS is really a registered trademark of IPSOS S.A.

i In the U.S., the monthly median mortgage repayment takes 15.8 percent of the median monthly income as the monthly median rent payment takes 29.2 percent of the median monthly income. 
ii The Zillow Housing Aspirations Report is computed from an IPSOS poll which combines sample of 10,000 U.S. adults from 20 U.S. core-based statistical area (CBSA) metropolitans (Atlanta, Boston, Chicago, Dallas, Denver, Detroit, Los Angeles, Las Vegas, Miami, Minneapolis, New York, Philadelphia, Phoenix, St. Louis, San Diego, San Francisco, San Jose, Seattle, Tampa, and Washington, D.C.) age 18+, surveyed online in English. The survey includes a credibility interval of plus or minus 1.1 percentage points for several respondents from the 20 U.S. metropolitans and approximately 5.0 percentage points for a person U.S. metropolitan. Post-hoc weights were designed to the populace characteristics on gender, age, region, and race and ethnicity. This version of the survey was conducted March 1st – 15th, 2017. To find out more about conducting research designed for public release or Ipsos’ online polling methodology, please go to the Public Opinion Polling and Communication page. 
iii Renters surveyed said creating a down payment is really a greater barrier than qualifying for a home loan, debt, job security, not being able to relax and low inventory of homes. 
ivSan Jose and Miami will be the only metros on the list of largest 35 U.S. metros in which a mortgage payment occupies more income when compared to a rental payment.  
v Zillow release on deposit costs here.   
vi The initial annual Zillow Group Report may be the largest-ever survey of U.S. home buyers, sellers, owners and renters, and asked a lot more than 13,000 U.S. residents aged 18 to 75 about their homes – how they seek out them, purchase them, maintain and improve them, and what frustrations and aspirations color their decisions.  
vii Rates for a 30-year fixed mortgage. Most of 4.13 percent was hit on March 14, 2017.

SOURCE Zillow

7 Apr

Seattle Renters Need Biggest Income Boost to Keep Up with Rising Rents

SEATTLE, April 7, 2017 /PRNewswire/ — Renters in Seattle, Los Angeles, and Boston need the biggest income increases in 2017 to keep up with rising rents, according to a new Zillow analysisi. In each of these metros, renters need their annual incomes to be at least $1,000 higher next year to have the same amount of money left over after paying rent.

Nationally, annual incomes would need to rise just $168 for renters to keep up with rising rents in the next year alone – an increase that comes on top of nearly five years of rising rents putting a dent in paychecks across the country.  

These income increases will only maintain the current amount of left over cash after paying rent. In several major metros, the share of income needed to pay rent already surpasses the general rule of not spending more than 30 percent of income on housing. In nearly all large markets, the median rent requires a larger share of income than it did before the housing bubble and bust.

Housing affordability is still a significant issue for renters, who have experienced rising rents for years. In some markets, the median rent requires more than 40 percent of the typical household income. However, rent appreciation is slowing, and rents are predicted to rise just 1 percent over the next year.

“For a long time now, renters have faced an affordability crisis when it comes to housing, and renters in some hot markets will still need significant raises just to keep up with rising rents,” said Zillow Chief Economist Dr. Svenja Gudell. “Incomes have a ways to go to bring rental affordability closer to historical levels, but recent gains are being met with slowing rent appreciation, a welcome sign for renters.”

Top Five Markets Needing the Biggest Annual Income Increase to Keep Up with Rising Rents

Metro

Annual Income Increase

1.

Seattle

$1,248

2.

Los Angeles

$1,152

3.

Boston

$1,140

4.

Sacramento, Calif.

$792

5.

Orlando, Fla.

$672

Not all rental markets are expected to see as strong of rent appreciation. Renters in the Bay Area, Chicago, and Houston, for example, do not need their incomes to grow to have the same amount of money left over after paying rent. Income growth in these markets will provide some much needed relief for renters in terms of housing affordability.

Metropolitan Area

Zillow Rent
Index
(February
2017)

Forecasted
Zillow Rent Index
(February 2018)

Annual Income
Increase Needed
to Maintain
Current
Disposable
Income After
Paying Rent

Annual Income
Percent Change
Needed to
Maintain Current
Disposable
Income After
Paying Rent

United States

$1,406

$1,420

$168

0.3%

New York/Northern New Jersey

$2,391

$2,382

$0

0.0%

Los Angeles-Long Beach-Anaheim, CA

$2,642

$2,738

$1,152

2.0%

Chicago, IL

$1,619

$1,603

$0

0.0%

Dallas-Fort Worth, TX

$1,565

$1,609

$528

0.9%

Philadelphia, PA

$1,568

$1,593

$300

0.5%

Houston, TX

$1,547

$1,540

$0

0.0%

Washington, DC

$2,114

$2,140

$312

0.5%

Miami-Fort Lauderdale, FL

$1,854

$1,879

$300

0.6%

Atlanta, GA

$1,335

$1,334

$0

0.0%

Boston, MA

$2,342

$2,437

$1,140

1.7%

San Francisco, CA

$3,354

$3,240

$0

0.0%

Detroit, MI

$1,175

$1,184

$108

0.2%

Riverside, CA

$1,754

$1,792

$456

1.1%

Phoenix, AZ

$1,309

$1,346

$444

0.9%

Seattle, WA

$2,100

$2,204

$1,248

1.8%

Minneapolis-St Paul, MN

$1,566

$1,606

$480

0.8%

San Diego, CA

$2,452

$2,506

$648

1.2%

St. Louis, MO

$1,132

$1,118

$0

0.0%

Tampa, FL

$1,347

$1,373

$312

0.7%

Baltimore, MD

$1,720

$1,705

$0

0.0%

Denver, CO

$1,998

$2,043

$540

0.9%

Pittsburgh, PA

$1,068

$1,049

$0

0.0%

Portland, OR

$1,804

$1,859

$660

1.2%

Charlotte, NC

$1,248

$1,280

$384

0.7%

Sacramento, CA

$1,709

$1,775

$792

1.5%

San Antonio, TX

$1,323

$1,330

$84

0.2%

Orlando, FL

$1,396

$1,452

$672

1.6%

Cincinnati, OH

$1,254

$1,299

$540

1.1%

Cleveland, OH

$1,141

$1,136

$0

0.0%

Kansas City, MO

$1,251

$1,280

$348

0.7%

Las Vegas, NV

$1,247

$1,258

$132

0.3%

Columbus, OH

$1,293

$1,315

$264

0.5%

Indianapolis, IN

$1,184

$1,161

$0

0.0%

San Jose, CA

$3,449

$3,421

$0

0.0%

Austin, TX

$1,694

$1,706

$144

0.3%

Zillow

Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ:Z and ZG), and headquartered in Seattle.

Zillow is a registered trademark of Zillow, Inc.

i Zillow computed the dollar value associated with our 12-month-ahead rent forecasts (February 2017 to February 2018) across major housing markets and then compared these dollar values to average wage and salary income in each market as reported for 2016-Q3 in the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages. We then calculated the annual percent increase in incomes necessary to cover expected rent growth over the next 12 months. We assume that the entire paycheck increase will go to housing costs with no increases in other costs. It does not account for taxes or rising costs of other items such as food, healthcare or energy. For markets where we forecast an aggregate rent decline over the next 12 months, we force the necessary paycheck increase to zero.

SOURCE Zillow