Zillow issues reality check to Americans wanting to buy a home: Most severe figure in 19 years now a serious threat

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Waiting for mortgage rates to fall before buying a home? A warning from Zillow suggests that relief may be harder to come by than many shoppers hope.

In August, the yield on the 30-year U.S. Treasury bond briefly hit its highest level (1) in 19 years. That figure wasn’t a mortgage rate. But rising Treasury yields can put upward pressure on borrowing costs, making an already difficult housing market even tougher for buyers.

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The Treasury Department responded by announcing (2) larger buybacks of long-term government bonds. Buying bonds can lift their prices and push yields lower.

However, Zillow senior economist Kara Ng cautioned that the move had not resolved what was driving yields higher.

“Mortgage borrowers should remember that while Treasury yields were mechanically pushed down, the underlying forces behind their rise – the government deficit, oil shock, and AI debt – haven’t faded and will likely put a floor under how far mortgage rates can fall,” Ng said (3).

Now, the bond market is flashing another warning. In a Sept. 23 Zillow report (4), Ng said another jump in Treasury yields could push mortgage rates higher just as fall shoppers look for deals.

“On September 23, the 10-year Treasury yield logged the highest daily spike since April 2025, landing at 5.1%, its highest level in about two decades,” Ng wrote, adding, “Rising bond yields will likely put upward pressure on already-elevated mortgage rates.”

Zillow now expects the 30-year fixed mortgage rate to ease only slightly to 6.7% by the end of 2026.

For homebuyers, that creates a frustrating trade-off: A fall price cut could make a home cheaper, only for higher borrowing costs to eat into the savings. Zillow says the mortgage payment on a typical home was already 2% higher in August than a year earlier.

None of this means Americans must give up on homeownership or real estate altogether. But it does make the financing decision more consequential — whether you’re trying to buy a home, invest in property or make use of the equity you’ve already built.

Here are three ways to explore your options.

Make lenders compete for your business

You can’t control Treasury yields or predict when mortgage rates will fall. But the national average isn’t the rate every lender will offer you.

Your credit, down payment and loan choice all affect your quote — and lenders can price the same loan differently. When every fraction of a percentage point counts, taking the first offer you receive could cost you for years to come.

Freddie Mac recommends shopping around, obtaining quotes from three to five lenders to secure the best mortgage rate possible. Even a small rate reduction can translate into significant savings over the life of a loan.

To make this process easier, platforms like the Mortgage Research Center (MRC) can help you quickly compare rates and estimated monthly payments from multiple vetted lenders. By entering basic details — such as your zip code, property type, price range and annual income — you can view mortgage offers tailored to your needs and shop with confidence.

Read More: Vanguard reveals what’s coming for U.S. stocks — and it could be bad news for this group of investors

Invest in real estate without buying a house

Real estate can offer something many investors want: the potential for recurring rental income alongside long-term growth in a property’s value. And because people will always need places to live, housing remains an essential part of the economy.

But buying an investment property takes a substantial down payment, and high borrowing costs can eat into the rent you collect. Then there’s the work of finding tenants, handling repairs and managing the property.

The good news? You don’t need to buy a property outright — or deal with leaky faucets — to invest in real estate today. Crowdfunding platforms like mogul offer an easier way to get exposure to this income-generating asset class.

As a real estate investment platform offering fractional ownership in blue-chip rental properties, mogul gives investors monthly rental income, real-time appreciation and tax benefits — without the need for a hefty down payment or 3 a.m. tenant calls.

Founded by former Goldman Sachs real estate investors, the team hand-picks the top 1% of single-family rental homes nationwide for you. In other words, you gain access to institutional-quality offerings for a fraction of the usual cost.

Each property undergoes a rigorous vetting process, requiring a minimum 12% return even in downside scenarios. Across the board, the platform features an average annual IRR of 18.8%. Offerings often sell out in under three hours, with investments typically ranging between $15,000 and $40,000 per property.

Sign up for an account and browse available properties here to start investing today.

Another option is Lightstone DIRECT, which gives accredited investors access to single-asset multifamily and industrial deals.

Lightstone DIRECT’s direct-to-investor model ensures a high degree of alignment between individual investors and a vertically-integrated, institutional owner-operator — a sophisticated and streamlined option for individual investors looking to diversify into private-market real estate.

With Lightstone DIRECT, accredited individuals can access the same multifamily and industrial assets Lightstone pursues with its own capital, with minimum investments starting at $100,000.

Tap your equity without giving up a low mortgage rate

The rate squeeze affects homeowners, too. If you locked in a low mortgage rate years ago, a cash-out refinance to fund a renovation or major purchase could replace that rate with a much higher one.

A home equity line of credit, or HELOC, offers another option. It’s a revolving line of credit that leverages the equity in your home as collateral. That means you can borrow and repay funds as needed — similar to a credit card.

AmeriSave offers a flexible HELOC that lets homeowners borrow against their equity as needed during a draw period, making it useful for renovations or debt consolidation. The application is mostly online and available in most states.

It can be a good fit for borrowers who want convenience and flexibility rather than a large lump-sum loan up front. You can draw funds only when you need them, so it can help manage ongoing or unpredictable costs. Interest is charged only on what you use, and you repay the balance over time. It’s essentially a flexible credit line secured by your home, delivered through a mostly online application process.

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Article Sources

We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines.

CNBC (1); U.S. Department of the Treasury (2); Yahoo Finance (3); Zillow (4)

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.