Svenja Gudell, chief economist at Zillow, leads a team of economists, data scientists and analysts dedicated to producing real estate research for consumers, academics, policymakers and industry-wide decision-makers.

“My team focuses on research spanning affordability, mortgages, negative equity, generational issues and policy issues,” she told Think Realty in a recent interview. “We cover trends in more than 450 metro areas and provide literally hundreds of data series down to the ZIP code level that make it easier for people to make decisions.”

In light of the high volume of data at Gudell’s fingertips, Think Realty asked her about one of the timeliest topics of the day: housing affordability.

You’ve said that housing affordability issues often have their root in negative equity. Could you elaborate on that?

My very first project at Zillow was to calculate negative equity, which basically happens when the house that you own is worth less than the actual mortgage balance outstanding on it. Since that was my first project and I dug deeply in to that data, it has a special spot in my heart.

It was shocking to me, after that research, to find out how many people were underwater at the height of the housing crisis and to know how many people are still underwater. While it’s an academic issue for many of them because often homeowners do not even know that they’re underwater if they are not actively looking to move, negative equity can have such tremendous effects on your life, and your livelihood when you do need to move and you’re unable to sell your house because of it.

People need to be aware not just of how much of their monthly budget should be going toward mortgage or rent, but how much of it will be going toward mortgage or rent. Affordability differs in different cities, but also by different races, age groups and income groups. Understanding these distinctions helps us analyze what’s going on in a particular area and offer advice.

Can you give us an example?

When you start to dig into affordability for the bottom third of income-earners [who tend to be renters], things get a little bit trickier. In many markets, the bottom third of income-earners are actually priced out of for-sale housing because they cannot afford a mortgage. Unfortunately, they are not really able to afford renting either. They may double up or even triple up to make that work.

This seems like a huge issue. Why don’t we hear about it when real estate market numbers are released quarterly?

This is a great example of what happens when you only look at the median or average numbers in real estate. It’s so easy to gloss over these things. If you look at different subgroups of what you would usually be looking at if you focus on the average, you will dig out a lot more information. In the case of affordability, you will find that there are groups even in affordable areas of the country that are really suffering.

EDITOR’S NOTE: Those lowest-earning tenants are the most likely to be most immediately affected by legislation that may, on the face of it, be designed to protect this population, and the landlords who serve those tenants endure elevated risk as well thanks to a nearly nonexistent presence on the political, lobbying and advocacy scenes.

Tags | Zillow
  • Carole VanSickle Ellis

    Carole VanSickle Ellis serves as the news editor and COO of Self-Directed Investor (SDI) Society, a membership organization dedicated to the needs of self-directed investors interested in alternative investment vehicles, including real estate. Learn more at or reach Carole directly by emailing

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