In the priciest markets, saving and breaking even on a home purchase can take a buyer into their retirement years
Rhea-AI Summary
Zillow (NASDAQ:Z, NASDAQ:ZG) released a new analysis estimating how long it takes a median-income U.S. household to save for a 20% down payment and reach the financial break-even point versus renting. Nationally, a buyer saving 10% of income needs 8.5 years to save and another 6.2 years to come out ahead, a total of 14.7 years.
Timelines vary widely by metro: Memphis is shortest at 10.9 years, while San Jose reaches 49.2 years and San Francisco 46.9 years. Targeting a starter home roughly halves the national timeline to 7.2 years. Zillow links extended break-even periods to a 4.7 million-home national supply shortfall and highlights tools such as BuyAbility, CreditClimb and down payment assistance filters to help buyers assess affordability.
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News Explained
The disclosure adds market-specific affordability assumptions, not company funding or ownership terms, using conditions as of July 2026.
Zillow presents a
Zillow defines a starter home as the average property in the lowest third of regional home values, and compares that scenario with renting a typical multifamily unit rather than the typical single-family rental used in the primary scenario. The 7.2-year starter-home result therefore reflects a different home and rental comparison, not only a lower purchase price.
Nationally, the combined timeline was 11 years in July 2019 versus 14.7 years in the current analysis, while Zillow estimates a 4.7 million-home supply shortfall. These figures place the reported affordability change in a dated market comparison rather than a company-level financial change.
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Nationally, a typical household can save for and come out ahead on a home purchase compared to renting after about 15 years
- A typical
U.S . household needs 8.5 years to save for a down payment and an additional 6.2 years to break even on the purchase relative to renting, according to a new analysis by Zillow. - In
San Jose , the combined timeline is almost 50 years. InMemphis , it's about 11 years. - Targeting a starter home can cut the timeline roughly in half: Nationwide, a typical household reaches the break-even point in 7.2 years.
To measure how long a potential buyer should expect to wait until buying makes more financial sense than renting, Zillow looked at how long it takes to save for a down payment, then come out ahead financially compared to renting a single-family home. Nationally, a household saving
The numbers vary widely market by market.
"The common wisdom is that saving early to buy a home is the smart financial move, but the reality is more nuanced," said Kara Ng, senior economist at Zillow. "The breakeven number tells you something about a market that a price tag alone doesn't. Buyers should think about not just when they can afford to buy, but how long they'd need to stay before owning makes more financial sense than renting. Homeownership comes with equity and stability, while renting offers flexibility and freedom from maintenance bills and emergencies."
The years add up differently depending on where you live
Not every timeline follows the same path. A typical household in
This split matters for how potential buyers should interpret these numbers. A long timeline in one market may reflect affordability challenges across the board, while in a market like
The starter home dilemma
One way to shorten the clock is to target a starter home, defined by Zillow as the average home in the lowest one-third of home values in a given region. Nationwide, it takes half the time — 7.2 years — to save for and come out ahead when buying a starter home compared to renting a typical multifamily unit.
However, with the cost of homeownership this high, buyers have signaled they do not want an expensive project. Turnkey homes sell for
The housing shortage is what's driving the affordability crisis
In July 2019, before the pandemic, the combined timeline was 11 years nationwide, nearly four years shorter than it is today. At the root of the housing affordability crisis is a shortage that stands at 4.7 million homes, according to Zillow's latest estimate. The metros with the largest shortages tend to also have the longest break-even timelines.
Closing a gap this large requires action on multiple fronts. Zillow advocates for measures that make it easier and less expensive to build, including modernizing zoning to allow more density, streamlining permitting, and expanding financing options for manufactured housing.
Tools for buyers ready to move
For buyers ready to move, a few tools can help during the saving stage. BuyAbilitySM shows in real time what a buyer can afford as mortgage rates change. CreditClimb lets renters build credit from the rent they already pay, which can help them qualify for a better loan. And Zillow for-sale listings show down payment assistance programs that buyers may qualify for in their area.
Methodology
Years to save is calculated as the number of years a household saving
The primary scenario compares buying a typical single-family home, as measured by the Zillow Home Value Index, against renting a typical single-family unit, as measured by the Zillow Observed Rent Index. The starter home scenario compares buying a starter home — defined as the average home in the lowest third of home values in a given region — against renting a typical multifamily unit, as measured by the Zillow Observed Rent Index. Data reflects market conditions as of July 2026.
Metro Area | Years to Save | Years to Break Even | Total | Years to Save | Years to Break Even | Total |
8.5 | 6.2 | 14.7 | 4.6 | 2.6 | 7.2 | |
14.3 | 15.1 | 29.4 | 9.2 | 3.9 | 13.1 | |
19.8 | 17.9 | 37.7 | 12.9 | 13.5 | 26.4 | |
7.9 | 6.9 | 14.8 | 4.8 | 2.7 | 7.4 | |
7.4 | 9.5 | 16.9 | 5.0 | 5.9 | 10.9 | |
7.1 | 6.1 | 13.2 | 4.8 | 4.3 | 9.1 | |
9.3 | 11.4 | 20.7 | 5.6 | 6.6 | 12.2 | |
8.3 | 9.8 | 18.0 | 4.7 | 3.3 | 7.9 | |
13.2 | 9.6 | 22.8 | 5.9 | 2.6 | 8.5 | |
7.8 | 5.3 | 13.2 | 5.2 | 3.1 | 8.2 | |
12.3 | 15.1 | 27.4 | 8.2 | 7.4 | 15.6 | |
9.5 | 6.1 | 15.6 | 6.8 | 4.6 | 11.4 | |
16.9 | 30.0 | 46.9 | 9.2 | 17.0 | 26.2 | |
12.3 | 10.8 | 23.0 | 8.7 | 7.3 | 15.9 | |
6.6 | 4.8 | 11.4 | 3.4 | 1.6 | 4.9 | |
13.0 | 18.4 | 31.4 | 8.6 | 13.2 | 21.8 | |
7.8 | 8.2 | 16.0 | 5.4 | 6.3 | 11.7 | |
17.0 | 23.4 | 40.4 | 11.3 | 13.3 | 24.5 | |
9.0 | 6.3 | 15.2 | 5.6 | 3.0 | 8.6 | |
10.3 | 10.3 | 20.6 | 6.9 | 11.5 | 18.4 | |
7.9 | 9.5 | 17.4 | 4.4 | 3.6 | 8.0 | |
6.5 | 9.2 | 15.7 | 3.3 | 2.7 | 5.9 | |
9.3 | 5.8 | 15.1 | 6.1 | 3.3 | 9.4 | |
8.5 | 5.9 | 14.4 | 5.5 | 3.5 | 9.0 | |
6.7 | 7.8 | 14.4 | 4.3 | 5.6 | 9.9 | |
10.6 | 16.3 | 26.8 | 7.8 | 18.2 | 25.9 | |
11.2 | 14.4 | 25.6 | 8.2 | 12.8 | 21.0 | |
5.5 | 5.6 | 11.1 | 2.9 | 2.1 | 5.0 | |
7.4 | 4.8 | 12.2 | 4.5 | 3.1 | 7.6 | |
8.1 | 18.1 | 26.2 | 5.7 | 23.3 | 28.9 | |
10.5 | 5.3 | 15.7 | 7.3 | 3.7 | 11.0 | |
7.4 | 8.6 | 16.0 | 4.4 | 3.4 | 7.8 | |
8.0 | 5.5 | 13.5 | 4.5 | 3.2 | 7.7 | |
7.1 | 4.4 | 11.5 | 4.4 | 2.4 | 6.8 | |
7.0 | 6.1 | 13.1 | 3.9 | 2.4 | 6.3 | |
19.2 | 30.0 | 49.2 | 10.8 | 24.5 | 35.3 | |
9.8 | 8.4 | 18.2 | 6.6 | 5.3 | 12.0 | |
8.6 | 9.3 | 18.0 | 5.8 | 5.8 | 11.7 | |
12.5 | 10.0 | 22.5 | 9.2 | 8.2 | 17.3 | |
8.3 | 7.3 | 15.5 | 5.0 | 3.3 | 8.3 | |
9.8 | 11.9 | 21.8 | 5.9 | 4.4 | 10.3 | |
6.3 | 9.2 | 15.5 | 3.9 | 4.3 | 8.1 | |
8.1 | 10.3 | 18.4 | 5.6 | 6.3 | 11.8 | |
6.8 | 4.2 | 10.9 | 3.4 | 1.8 | 5.2 | |
9.1 | 6.7 | 15.8 | 6.3 | 4.6 | 10.9 | |
7.2 | 4.7 | 11.9 | 4.7 | 2.7 | 7.4 | |
8.0 | 11.2 | 19.2 | 5.1 | 3.3 | 8.4 | |
10.9 | 6.9 | 17.8 | 8.0 | 6.9 | 14.9 | |
8.5 | 14.3 | 22.8 | 5.8 | 10.3 | 16.0 | |
7.6 | 4.7 | 12.3 | 5.1 | 3.2 | 8.3 | |
6.6 | 5.2 | 11.7 | 3.0 | 1.8 | 4.9 |
*Table ordered by market size |
About Zillow Group
Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people.
As the most visited real estate app and website in the United States, Zillow connects hundreds of millions of consumers with innovative technology, trusted agents and loan officers, and seamless digital solutions. With industry-leading tools and resources, Zillow supercharges real estate professionals so they can grow their businesses and deliver exceptional client experiences. For renters and housing providers, Zillow offers not only a robust marketplace but a set of end-to-end products and services to streamline applications, leases, payments and more.
Zillow's ecosystem spans the entire home journey — from dreaming and shopping to renting, buying, selling and financing.
Zillow Group's affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans®, Zillow Rentals®, Zillow® New Construction, Trulia®, StreetEasy®, Out East®, HotPads®, Follow Up Boss®, ShowingTime®, dotloop® and Zillow® Closing.
All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2026 MFTB Holdco, Inc., a Zillow affiliate.
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