The typical household needs seven years to save for the average down payment, according to a new data report from Realtor.com. This is down from the peak of 16 years recorded in April 2022, although it remains well above the pre-pandemic level.
In many expensive coastal metros, saving for a typical down payment can take 20 to more than 35 years. However, it markets with a large presence of military servicemembers and veterans, widespread VA loan usage enables buyers to purchase residential property. with little or no down payment.
In the third quarter of 2019, the typical buyer paid about $13,900 as a down payment. By the third quarter of this year, the figure had more than doubled to $30,400.
“Higher home prices and intensified competition have pushed typical down payments higher, at the same time that inflation and rising household expenses have reduced savings rates,” said Danielle Hale, chief economist at Realtor.com. “Although conditions have improved since 2022, today’s timeline shows that saving for a home takes meaningfully longer than it did before the pandemic, especially in high-cost markets.”
