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With home prices rising, home buyers are bringing higher down payments to make their offers more attractive to sellers. Buyers are offering about twice as much cash for down payments as they did two years ago, according to realtor.com® data.
Buyers, on average, offered a $28,000 down payment in the first quarter. In 2020, down payments averaged averaged $14,000.
The percentage of down payments has grown, too. In the first quarter of 2020, buyers averaged a 10.9% down payment on the purchase price, compared to 13.1% in the first quarter of this year.
Median home list prices rose 26.1% over that same period from 2020 to 2022, according to realtor.com®.
“During the pandemic, people were not spending as much on entertainment and travel and received stimulus payments, which enabled them to put more cash down on homes,” says Hannah Jones, realtor.com® economic data analyst.
Several Florida metro areas posted the largest increases in down payments, led by Cape Coral. Down payments there rose by 174.7% from the first quarter of 2021 to the first quarter of 2022. The average buyer had a down payment of $42,000, according to the realtor.com® report.
However, the largest overall down payment averages for a home were in Silicon Valley’s San Jose, Calif., at 23.7% of the price of a home—$290,000, according to the report.