How Fast Can You Save for a Down Payment?

Saving for a down payment is often the biggest hurdle for a first-time homebuyer. Depending on where you live, median income, median rents, and home prices all vary. So, we set out to find out how long would it take you to save for a down payment in each state? Using data from the United States Census Bureau and Zillow , we determined how long it would take, nationwide, for a first-time buyer to

Saving for a down payment is often the biggest hurdle for a first-time homebuyer. Depending on where you live, median income, median rents, and home prices all vary. So, we set out to find out how long would it take you to save for a down payment in each state? Using data from the United States Census Bureau and Zillow, we determined how long it would take, nationwide, for a first-time buyer to save enough money for a down payment on their dream home. There is a long-standing ‘rule’ that a household should not pay more than 28% of their income on their monthly housing expense. By determining the percentage of income spent renting a 2-bedroom apartment in each state, and the amount needed for a 10% down payment, we were able to establish how long (in years) it would take for an average resident to save enough money to buy a home of their own. According to the data, residents in Iowa can save for a down payment the quickest in just under 2 years (1.99). Below is a map created using the data for each state:

What if you only needed to save 3%?

What if you were able to take advantage of one of Freddie Mac’s or Fannie Mae’s 3% down programs? Suddenly, saving for a down payment no longer takes 5 or 10 years, but becomes attainable in a year or two in many states as shown in the map below.

Bottom Line

Whether you have just begun to save for a down payment, or have been saving for years, you may be closer to your dream home than you think! Meet with a local real estate professional who can help you evaluate your ability to buy today.

Millennials Want To Buy Homes

Despite dwindling savings and the challenges of the housing market, millennials still want to buy homes. Learn more about millennial home buyers from this infographic!

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The Real Cost of Renting vs. Buying [INFOGRAPHIC]

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  • Historically, the choice between renting or buying a home has been a close decision.
  • Looking at the percentage of income needed to rent a median-priced home today (30%), vs. the percentage needed to buy a median-priced home (15%), the choice becomes obvious.
  • Every market is different. Before you renew your lease again, find out if you could use your housing costs to own a home of your own!

Buying a Home Can Be Scary Unless You Know the Facts

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  • 36% of Americans think they need a 20% down payment to buy a home.
  • 44% of Millennials who purchased a home this year have put down less than 10%.
  • 71.8% of loan applications were approved last month.
  • The average credit score of approved loans was 731 in September.

7 Graphs That Show the Real Estate Market Is Back

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  • Distressed property sales fell to its lowest number since NAR began tracking it in 2008.
  • With fewer distressed properties, sales are up in all price ranges except the $0 – $100K price range.
  • Interest rates are still at historic lows, for many, now is the time to buy.

‘Old Millennials’ Are Diving Head-First into Homeownership

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Do You Know the Impact Your Interest Rate Makes?

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  • Interest rates

    have come a long way in the last 30 years.

  • The interest rate you secure directly impacts your monthly payment and the amount of house that you can afford if you plan to stay within a certain budget.
  • Interest rates are at their lowest in years.
  • If buying your first home, or moving up to the home of your dreams is in your future, now may be the time to act.

Slaying Myths About Home Buying [INFOGRAPHIC]

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What Would You Sacrifice To Buy A Home? [INFOGRAPHIC]

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