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Here are the 13 US housing markets that would be most affected by rising interest rates
US homebuyers are most concerned about rising interest rates, but they still plan to go ahead with their initial buying plans, according to survey results released by Zillow Group Mortgages.
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"Most people (83 percent) planning to buy within the next three years will continue with their homebuying plans even if rates increase their monthly mortgage payment by $100," Zillow said in a press release.
Higher rates would, however, limit buyer choices. According to Zillow, "a quarter of home shoppers claim they would reconsider the type of home they are searching for, such as looking for a smaller home or less expensive community, should their monthly payment increase by up to $100 (25%)."
When it comes to the impact of a rate hike on monthly mortgage payments, "for the typical homebuyer shopping for the median US home, valued at $195,300," the company estimated, "an increase in mortgage rates from 4% to 4.25% would increase their monthly mortgage payment by approximately $23."
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Among the states, California is likely to be most affected if the series of rate hikes predicted for 2017 do indeed occur, as the state is home to cities with the greatest rise in monthly mortgage payments (San Jose, San Francisco, Los Angeles, and San Diego).
Here are the 13 US cities that, according to Zillow, would see the highest increase in monthly mortgage payments if mortgage rates were to rise to 5% from 4%.
Zillow Home Value Index: $263,400
Monthly mortgage payment at 4%: $1,006
Monthly mortgage payment at 5%: $1,131
Difference in monthly mortgage payment: $125
Source: Zillow
Zillow Home Value Index: $321,200
Monthly mortgage payment at 4%: $1,227
Monthly mortgage payment at 5%: $1,380
Difference in monthly mortgage payment: $153
Source: Zillow
Zillow Home Value Index: $355,000
Monthly mortgage payment at 4%: $1,356
Monthly mortgage payment at 5%: $1,525
Difference in monthly mortgage payment: $169
Source: Zillow
Zillow Home Value Index: $357,000
Monthly mortgage payment at 4%: $1,363
Monthly mortgage payment at 5%: $1,533
Difference in monthly mortgage payment: $170
Source: Zillow
Zillow Home Value Index: $356,900
Monthly mortgage payment at 4%: $1,363
Monthly mortgage payment at 5%: $1,532
Difference in monthly mortgage payment: $169
Source: Zillow
Zillow Home Value Index: $380,900
Monthly mortgage payment at 4%: $1,455
Monthly mortgage payment at 5%: $1,636
Difference in monthly mortgage payment: $181
Source: Zillow
Zillow Home Value Index: $404,800
Monthly mortgage payment at 4%: $1,546
Monthly mortgage payment at 5%: $1,738
Difference in monthly mortgage payment: $192
Source: Zillow
Zillow Home Value Index: $413,900
Monthly mortgage payment at 4%: $1,581
Monthly mortgage payment at 5%: $1,778
Difference in monthly mortgage payment: $197
Source: Zillow
Zillow Home Value Index: $413,900
Monthly mortgage payment at 4%: $1,581
Monthly mortgage payment at 5%: $1,778
Difference in monthly mortgage payment: $197
Source: Zillow
Zillow Home Value Index: $530,900
Monthly mortgage payment at 4%: $2,028
Monthly mortgage payment at 5%: $2,280
Difference in monthly mortgage payment: $252
Source: Zillow
Zillow Home Value Index: $595,700
Monthly mortgage payment at 4%: $2,275
Monthly mortgage payment at 5%: $2,558
Difference in monthly mortgage payment: $283
Source: Zillow
Zillow Home Value Index: $833,600
Monthly mortgage payment at 4%: $3,184
Monthly mortgage payment at 5%: $3,580
Difference in monthly mortgage payment: $396
Source: Zillow
Zillow Home Value Index: $970,000
Monthly mortgage payment at 4%: $3,705
Monthly mortgage payment at 5%: $4,166
Difference in monthly mortgage payment: $461
Source: Zillow
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