In a nationwide survey, the typical adult
failed Zillow's real estate knowledge quiz, revealing significant
knowledge gaps about what is often life's biggest financial
investment
SEATTLE, June 16,
2022 /PRNewswire/ -- Americans are as mystified
by how real estate works as they are about cryptocurrency. A new
Zillow® survey finds most Americans know more about celebrity love
lives, the Kardashians and the NFL than they know about the basics
of buying a home. In the nationwide survey, the typical adult
failed Zillow's basic real estate knowledge quiz, answering only
two of five questions correctly.
Financing is a crucial first step in the home-buying process,
but it's also one of the most confusing. Two-thirds of survey
respondents don't understand the benefits of getting pre-approved
for a mortgage. Advantages of having pre-approval can include
closing on a home faster, getting clear budget constraints and
making an offer that's more attractive to a seller. A lower
interest rate is not a benefit of pre-approval, as the
majority of respondents believed.
Determining a down payment amount and when private mortgage
insurance (PMI) is required is an important financial decision to
make when purchasing a home, as it can have a big impact on the
monthly payment. Many survey respondents assumed PMI is required no
matter what, but the only instance when it's not required is on a
conventional loan with a down payment of 20% or more.
Most U.S. adults correctly answered that a person's payment
history impacts their credit score, and that the purpose of an
appraisal is to determine if the home is worth its purchase
price.
But when it comes to celebrity love lives, the Kardashians and
the NFL, Americans are more in the know, even though their lives
and finances aren't directly impacted. The typical survey
respondent answered three of five questions correctly in each of
these categories.
Nearly 85% of respondents knew that Kim
Kardashian has four children with Kanye West, and 70% correctly answered whom
Jennifer Lopez is now engaged to
after first breaking up in 2004 (answer: Ben Affleck). And on the topic of football, the
typical American knows a lot about Tom
Brady; 71% of respondents knew that the popular quarterback
left the New England Patriots to play for the Tampa Bay
Buccaneers.
The typical American is as baffled by real estate as they are by
the complex world of cryptocurrency, answering just two of five
questions correctly.
"The real estate process can be complicated and confusing, but
it doesn't have to be," said Amanda
Pendleton, Zillow home trends expert. "By educating
themselves on basic real estate fundamentals and hiring experts to
help guide them through the process, buyers can avoid costly
pitfalls and put themselves in a stronger competitive position.
When it comes to picking the right home, real estate technology
like interactive floor plans puts information closer to the average
buyer's fingertips than ever before, helping them move quickly and
with confidence."
Here are five tips to help buyers through their home-shopping
journey:
- Understand what you can afford. Buyers should start
with a mortgage calculator and Zillow's affordability tools to
understand what goes into a mortgage payment and what they can
realistically afford on a monthly basis.
- See if you qualify for down payment assistance. Coming
up with enough money for a down payment is a common barrier to
homeownership. Aspiring buyers can see which down payment
assistance programs may be available on every home listing on
Zillow.
- Find an agent you trust. Zillow's agent finder tool
helps buyers find the best agent to fit their specific needs.
Buyers can read reviews of top-rated real estate agents in their
area and reach out to them directly through the tool.
- Get pre-approved for a mortgage — not just prequalified.
It's a more extensive financial check, but pre-approval will give
the buyer — and the seller — more confidence in the
buyer's ability to finance the home. A new Zillow survey finds 86%
of sellers prefer a buyer who has been pre-approved, as opposed to
pre-qualified, for a mortgage. Buyers can start the pre-approval
process online.
- Shop around for a lender. Zillow research indicates
some home buyers can save tens of thousands of dollars over the
length of their loan by shopping around for the best mortgage rate.
Buyers can compare rates and fees for multiple lenders on Zillow's
online mortgage marketplace.
Home shoppers can visit the Zillow blog to take the full quiz
and see how their real estate knowledge compares to the typical
American.
About Zillow Group
Zillow Group, Inc. (NASDAQ: Z
and ZG) is reimagining real estate to make it easier to unlock
life's next chapter. As the most visited real estate website in
the United States, Zillow® and its
affiliates offer customers an on-demand experience for selling,
buying, renting or financing with transparency and ease.
Zillow Group's affiliates and subsidiaries include Zillow®,
Zillow Premier Agent®, Zillow Home Loans™, Zillow Closing
Services™, Trulia®, Out East®, ShowingTime®, Bridge Interactive®,
dotloop®, StreetEasy® and HotPads®. Zillow Home Loans, LLC is an
Equal Housing Lender, NMLS
#10287 (www.nmlsconsumeraccess.org).
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SOURCE Zillow