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Down Payments Up 35% Year Over Year In Biggest Metros

by Leighton, Kelly on

Between student loan debt and inflation, many millennials and Generation Z members are continuing to struggle to become homeowners.

As home prices hit record highs this year and as mortgage rates continue to rise, these potential homebuyers are facing another obstacle. The average down payment is rising across the country. While there is no predetermined amount that needs to be put down, buyers need to prove they have the financial ability to pay off a mortgage. In 50 of the largest metros in the U.S., down payments have jumped 35% in 13 months from September 2021 to October 2022.

According to a recent LendingTree report, the average down payment in these metros is $62,611, up from $46,238 in September 2021. The down payment represents 58.3% on average of each area’s average yearly income. According to Realtor.com®, the average home price in October was $427,000, up 14% year over year. As of September, home sales fell 10.2% year over year.

Philadelphia fell in the middle of the list, landing in 24th place for average down payment, with buyers putting down an average of $58,147 with an average mortgage amount of $308,722. The down payment represents 53.1% of the average annual household income of $109,597. Pittsburgh’s down payment was more affordable, the 12th lowest down payment on the list of 50. In Pittsburgh, the average down payment was $46,765, with an average mortgage amount of $261,493. The down payment represents 50.9% of the average annual household income of $91,788.

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Homebuyers
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