Last month, rents rose by only 1.8% year over year, the slowest rate of increase since 2020, according to the Zillow® March Rental Report. That was much more slowly than wages climbed over the same period, leaving renters better off by an average of $2,318.
Renters can, of course, do anything they like with their windfalls, but savvy ones may be using the extra money to build their savings for a mortgage down payment. Coupled with a down payment assistance program, this newly freed money could see those with the goal of homeownership finding themselves buying much more quickly than previously seemed likely.
Distinct Geographical Variations
It's impossible to write about nationwide trends in housing markets without acknowledging the vast variations across places in the United States. And that certainly applies here.
For example, renters in San Francisco didn't save $2,318 annually. They gained only $458, which, given home sale prices in the city, won't make much of a dent in a down payment savings account.
At the other end of the scale, those in Austin, TX, saved $3,182. And other cities did nearly as well, with renters in Tampa, FL, better off by $3,110, and those in Denver, CO, by $3,002.
A Good Time to Buy?
In its March 2026 Housing Market Report (for the for-sale sector), Zillow found: "The monthly mortgage payment on a typical U.S. home is $1,789, assuming a 20% down payment and excluding taxes and insurance. That is 4.4% lower than last year."
That improvement is partly a result of slowing home price inflation, with values up only 0.8% from a year earlier, states Zillow. And it's partly down to lower mortgage rates. The average 30-year fixed-rate mortgage had a rate of 6.63% to 6.65% in March 2025. This March, that rate was down to between 6.0% and 6.38%, according to Freddie Mac.
Meanwhile, inventory (active listings) climbed to its highest point for any March since 2021. So, there's an unusually wide choice of available homes for renters ready to become homeowners.
"The for-sale market still requires a household income of about $76,400 to comfortably afford a typical home, roughly 35% higher than pre-pandemic levels," says Zillow. "But the window is beginning to open." Of course, average incomes have risen significantly over that period, too.
Be Realistic When Home Shopping
There's no point in buying a home that one can't afford. Sooner or later, reality will catch up.
And, even if mortgage and home-buying costs are moderating, other expenses aren't. So, it's important to know about a candidate house or condo's homeowners insurance premiums and property taxes before committing to a purchase.
Meanwhile, the Federal Reserve's preferred gauge of inflation, the personal consumption expenditures price index, was running at around 3% annually in February, warmer than the Fed's 2% target. And that was before the disruption in the Middle East pushed up gas and other prices.
Nothing in life comes with 100% certainty. And renters who wait for every single detail to be "right" before buying a home may well end their days as renters. But it's important to feel reasonably confident of one's financial security before pushing the button.
