Saving For A Down Payment Can Take From 2 To 94 Years

Depending on where you live saving for a down payment on a home might be anywhere from easy to impossible.

Down Payment on the Median Home

Buyers tend to want houses, not condos. but Saving for the Down Payment Takes Up to 94 Years

The national median home sales price reached $346,800 in the last quarter, bringing the down payment to almost $70,000. However, in a nationwide survey of nearly 7,000 prospective homebuyers carried out on its listings platform last autumn, Point2 found that around 75% of home seekers had much less than the average down payment amount set aside, and 14% had no savings yet. 

The 20% down payment is perilously close to a staggering $70,000. However, 30% of all survey-takers believe they would need less than $10,000, making it abundantly clear that their expectations might be sabotaging the homebuying efforts.

How Would it Take to Save a Down Payment?

  • There are big differences in median income between generation groups. Gen Z and millennials make the least so it would take them longer to save. 
  • At the current savings rate, Gen Z buyers would need more than ten years to save enough for a down payment in 36 cities.
  • It would take over 20 years in expensive cities like Los Angeles and San Jose, CA
  • Irvine, CA tops the list at 94 years. 

Easiest Places For Millennials to Buy a Home

Down Payment Easiest

Hardest Places For Millennials to Buy a Home

Down Payment Hardest

There are more details and interactive charts in the above link.

Note that the number of years assumes saving 17% of income, an unlikely proposition over time.

The median income for Generation Z in Irvine CA was only$11,796 vs LA at $35,400 which accounts for the unrealistic 94 years. Most likely the Gen Z crowd in Irvine are all in school. 

For millennials, the median household income in Irvine skyrockets to $115,318.

The study was for the largest 100 cities. 

Danville, Illinois

Out of curiosity, I decided to check up on Median Home Prices in Danville Illinois, my hometown.  

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