Down payments have gone up, up, up
This summer, the average buyer’s down payment was higher than it’s been in almost a decade. This is happening for two key reasons: a) the typical 5%-20% required down payment rose as home prices hit historic levels, and b) some buyers have been able to put down bigger payments after selling their homes at raised prices. Here are some key stats:
- In May and June, the average down payment reached $66,000.
- The typical down payment was 18% of the average home’s purchase price, which is a nine-year high
- In July, the average down payment declined to $62,500, but it was still nearly double the median down payment in July 2019 ($32,917)
This is another sign of why it’s becoming so hard for first-time buyers to get into homes. First Time buyers, although it is more expensive now to buy a home than it was last year, historically rates are still lower than they were decades ago. Get into a home now, secure a great investment, and then refinance later when the rates are better!
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