New housing market data released by Zillow reveals something astonishing: In the past five years between the pre-pandemic December of 2019 and December of 2024, the typical mortgage payment has increased by a whopping 106%. In other words, today’s typical mortgage payment is more than double what home buyers locked in just five years ago.
Zillow’s December 2024 Housing Market Report shows that the typical mortgage payment in America has shot up to $1,844. Looking back at Zillow’s archived data, we can see that in December 2019, the month before the COVID-19 pandemic hit the U.S., the typical mortgage payment was just $896.
How did this happen? One thought that might jump to mind is inflation. True, the U.S. inflation rate surged to a decades-high peak of 9.1% in June 2022. And it has only subsided to the sub-3% level in the past six months. But as you can see below, if you take the typical mortgage payment of $896 from December 2019 and account for the high inflation rates over the past five years, the payment would have only increased by 23%, reaching $1,100 per month.
A much bigger impact has come from soaring mortgage rates. In December 2019, Freddie Mac reported that the average rate on a 30-year fixed-rate mortgage was in the upper 3% range. Five years later in December of 2024, average mortgage rates are in the upper 6% range.
The 3-percentage-point difference between 2019 and 2024 has had a sizable impact. For instance, a $250,000 loan at 3.75% would result in a principal-and-interest payment (no insurance or taxes) of $1,158. Bump that interest rate up to 6.75% for a 30-year loan and the payment balloons to $1,621.
How We Track the Best Mortgage Rates
The national and state averages cited above are provided as is via the Zillow Mortgage API, assuming a loan-to-value (LTV) ratio of 80% (i.e., a down payment of at least 20%) and an applicant credit score in the 680–739 range. The resulting rates represent what borrowers should expect when receiving quotes from lenders based on their qualifications, which may vary from advertised teaser rates. © Zillow, Inc., 2024. Use is subject to the Zillow Terms of Use.