How much money you actually need for a home down payment


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Despite signs of a cooling housing market, home prices are still relatively high, resulting in bigger down payments. 

Over the past year, average down payments in the country’s 50 biggest metros have grown by more than 35%, according to a LendingTree report, based on 30-year fixed-rate mortgage data from Jan. 1 through Oct. 10, 2022.

While high home prices and interest rates may push some buyers to the sidelines, those still in the market may have “deeper resources,” particularly if they’re downsizing, explained Keith Gumbinger, vice president of mortgage website HSH.

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Here are the top five metros with the largest down payments.

5 metros with the biggest down payments

How a bigger down payment lowers mortgage costs

With high prices, many buyers struggle to put down 20%

Despite softening demand, home prices are still “significantly higher than two years ago,” with many buyers struggling to put 10% or 20% down, said Melissa Cohn, regional vice president at William Raveis Mortgage.

The median home sales price was $454,900 during the third quarter of 2022, compared to $337,500 during the third quarter of 2020, according to Federal Reserve data.

Many buyers take advantage of lower down payment options, she said, such as 3% or 5% for conventional mortgages or 3.5% for Federal Housing Administration loans.

“With a smaller down payment, it’s more expensive every which way,” Cohn said. “But for many people, it’s the only way they can afford to get into their home.” 

While smaller down payments mean higher interest rates and mortgage insurance, home buyers may reduce these expenses in the future, she said. When interest rates drop, there may be a chance to refinance, and buyers may remove mortgage insurance once they reach 20% equity in the home, Cohn said.

Total mortgage demand sinks to lowest level since 1997



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