Down payments are dropping from historic highs see how much you can save today

Homebuyers might be relieved to hear that down payments are finally dropping from recent historic highs.A new report by Realtor.com shows that the median down payment homebuyers plunked down from July to September of 2024 was an average of 14.5%—or $30,300.That’s a $2,400 savings from last quarter’s historic peak of $32,700 (14.9%).So why are down payments dropping? Fewer homebuyers are out there, which gives those who do brave today’s market more leverage, according to Realtor.com senior economic research analyst Hannah Jones.“The annual decline in down payments is the result of less buyer competition in the third quarter,” Jones says.“Easing demand and increasing inventory gave buyers more flexibility last quarter, which led to slightly lower down payments.”To produce these findings, the Realtor.com economic research team examined down payment trends throughout the U.S., individual states, and the top 150 metropolitan areas up to the third quarter of 2024, using data from Optimal Blue.

The team then determined the down payment as a percentage of the sale price by averaging the data.Down payment dollar amounts fell in 21 states in the third quarter of 2024.The states that saw the biggest down payment declines include COVID-19 pandemic-era hot spots such as Texas and Florida.These states “have seen significant softening over the last year as waning demand and climbing inventory impact home prices and reduce competition,” says Jones.The five states with the biggest down payment declines were Florida, down 24% year over year, to $27,000; Texas, down 23.2%, to $14,400; Wyoming, down 22.3%, to $25,200; the District of Columbia, down 17.7%, to $81,300; and South Dakota, down 16.4%, to $31,400.“Overall, the metros with the smallest down payments tend to be relatively affordable and flush with inventory,” says Jones.Housing stock was between 19% and 37% more abundant in these metros compared with one year ago, and homes were spendin...