Typical US Homebuyer’s Down Payment Hits Record High in June

On Wednesday, Redfin reported that the typical down payment for US homebuyers hit a record high of $67,500 in June, up 14.8% from $58,788 a year earlier. This was the 12th consecutive month the median down payment rose year-over-year.

Redfin notes that the nearly 15% jump in the median down payment significantly outpaced the increase in home prices, which were up 4% in June year-over-year. The increase is being influenced by the current market, where higher-priced, turnkey homes in desirable neighborhoods are more likely to sell. It’s also partly due to buyers putting down a higher percentage of the purchase price as a down payment.

The typical US homebuyer’s down payment was 18.6% of the purchase price in June, the highest level in over a decade and up from 15% a year earlier. Nearly three in five (59.4%) homebuyers put down more than 10% of the purchase price in June, up from 56.6% a year earlier.

In addition, Redfin reports that the percentage of US home purchases made with all cash rose to 30.7% in June, up slightly from 30.4% a year ago.

In remarks accompanying the report, Redfin Senior Economist Sheharyar Bokhari said:

“The percentage of all-cash sales generally follows the same trend as the rise and fall of mortgage rates. When rates are down, the percentage of all-cash sales is down too, and the opposite is true when rates go up. That means we may start to see all-cash purchases level off a little now that mortgage rates have started to come down from recent highs.”