Home prices have surged to double-digit percentage gains over the past year, which means home buyers are having to either bring more to the closing table or borrow more. They’re doing both.
Down payments are at record highs, according to ATTOM Data Solutions’ fourth quarter 2020 U.S. Residential Property Mortgage Origination Report. The median down payment on a single-family home and condo purchased with financing in the fourth quarter of 2020 was $24,500, up 82% compared to the fourth quarter of 2019 ($13,441), according to the report, with records dating back to at least 2000.
The median down payment represents 7.7% of the median sales price for homes purchased with financing during the fourth quarter of 2020, up from 5.2% a year prior.
Home buyers are borrowing more to afford the higher home prices. The median loan amount was $280,000—another record high, according to ATTOM Data Solutions’ report. The amount buyers are borrowing for their mortgage jumped nearly 25% compared to the fourth quarter of 2019.
The National Association of REALTORS®’ latest existing-home sales report, reflecting January housing data, showed the median existing-home price for all housing types was $303,900, a 14% increase compared to a year prior.
Source: ATTOM Data Solutions
