Redfin Reports The Typical Homebuyer’s Down Payment is a Record $67,500, Up 15% From a Year Ago
Nearly 3 in 5 homebuyers put down more than
The nearly
“Investors are still coming in with all-cash offers on homes that need to be renovated. Traditional buyers are putting down large down payments to try and lower their mortgage payment,” said Annie Foushee, a Redfin agent in
The typical homebuyer’s down payment was
Nearly three in five (
Down payments are increasing for a number of reasons:
-
Rising home prices: The median-priced
U.S. home was a record in June, up$442,525 4% year over year. Higher home prices naturally lead to a higher down payment, which is a percentage of the home price. -
Elevated mortgage rates: Homebuyers are incentivized to put down more money upfront, and borrow less, when mortgage rates are higher. The
6.92% average mortgage rate in June was among the highest in the past 20 years, pushing buyers to increase their down payment to minimize monthly payments. - Buyers have more equity: With home prices up, people who sell their previous property for more than they purchased it can use the extra equity for a larger down payment on their new home.
All-cash purchases make up nearly a third of home sales
The percentage of
“The percentage of all-cash sales generally follows the same trend as the rise and fall of mortgage rates. When rates are down, the percentage of all-cash sales is down too, and the opposite is true when rates go up,” said Redfin Senior Economist Sheharyar Bokhari. “That means we may start to see all-cash purchases level off a little now that mortgage rates have started to come down from recent highs.”
FHA loans fall to lowest level in nearly two years
FHA loans made up
VA loans made up
Conventional loans—the most common type—represented nearly four out of every five loans (
Metro-Level Highlights: June 2024
Metros with biggest increases/decreases in down payments, in dollars
In
Down payments only fell in three metros:
Metros with highest/lowest down payments, in percentages
In
Down payment percentages were lowest in Virginia Beach, FL (
Metros where all-cash purchases are most/least common
In
All-cash purchases were least common in
Metros with biggest increases/decreases in share of all-cash purchases
In
In
To view the full report, including charts, methodology and additional metro-level data please visit: https://www.redfin.com/news/all-cash-homebuyers-june-2024
About Redfin
Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, title insurance, and renovations services. We run the country's #1 real estate brokerage site. Our customers can save thousands in fees while working with a top agent. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can have our renovations crew fix it up to sell for top dollar. Our rentals business empowers millions nationwide to find apartments and houses for rent. Since launching in 2006, we've saved customers more than
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View source version on businesswire.com: https://www.businesswire.com/news/home/20240828874430/en/
Redfin Journalist Services:
Kenneth Applewhaite
press@redfin.com
Source: Redfin