Affordability Research

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Zillow’s research into affordability begins with an analysis of how large a share of consumers’ income is currently devoted to mortgage payments, and compares that to how much consumers were paying toward housing costs in the pre-bubble period from 1985 to 2000. It also predicts how much consumers will be devoting to mortgage payments as interest rates rise. Areas where consumers will be paying more of their incomes to afford a median home are at risk of becoming unaffordable, and may see home values drop in coming months and years.

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Highlights (Q2 2015):

  • Renters can expect to spend 30 percent of their income on rent, while buyers can expect to spend 15 percent of their monthly income on a monthly mortgage payment.
  • Rental affordability worsened year-over-year in 28 of the 35 largest metro areas covered by Zillow.
  • Denver, Los Angeles, San Francisco, San Jose, and San Diego are unaffordable for both renters and buyers.

Past Reports: