Buyers Are Making the Largest Down Payments in These High-Cost Cities

With housing inventory at historic lows and mortgage rates at a 20-year high, buyers are digging deep into their savings to make larger down payments in some costly metros. In order to beat out the competition, prospective buyers are offering up down payments that are more than 14% of the purchase price for single-family homes in 2022, up from just above 11% in 2019, Realtor.com reports.

In The Villages, FL, buyers are making down payments that are 30% of the $375,000 median home purchase price, and Coeur d’Alene, ID and Santa Barbara, CA aren’t far behind with average down payments that are 27.9% and 26.4% of their respective home purchase prices of $530,000 and $800,000.

While putting down 20% of the purchase price is the gold standard, in many competitive real estate markets, buyers are now expected to contribute significantly more. Yet, in other parts of the country, buyers can get away with kicking in just a fraction of that.

“Sellers look at the smaller down payment as coming from a riskier buyer, with less certainty that the mortgage will be approved or close on time,” says Rob Chrane, CEO of DownPayment Resource. The company helps homebuyers find information about down payment assistance. “It got really extreme before the market started cooling down.”

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