Here are the 13 US housing markets that would be most affected by rising interest rates

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San Diego.
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Flickr / Justin Brown

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.

“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.”

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%.


13. Austin, Texas

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Lifted Up Aerial Photography/Shutterstock

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


12. Riverside, California

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Shutterstock/Jon Bilous

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


11. Sacramento, California

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Andrew Zarivny/Shutterstock

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


10. Portland, Oregon

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Travel Portland/Facebook

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


9. Denver

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Nicholas Courtney/Shutterstock

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


8. Washington, DC

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Richard Ricciardi/Flickr

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


7. New York City

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Sarah Jacobs

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


6. Seattle

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Roman Khomlyak/Shutterstock

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


5. Boston

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Marcio Jose Bastos Silva/Shutterstock

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


4. San Diego

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Dancestrokes/Shutterstock

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


3. Los Angeles-Long Beach-Anaheim, California

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Greg Gjerdingen/Flickr

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


2. San Francisco

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Richard Heyes/flickr

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


1. San Jose, California

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Getty/Justin Sullivan

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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