How Much Time Do You Need To Save for a Down Payment?

Dated: April 19 2021

Views: 180

How Much Time Do You Need To Save for a Down Payment?

How Much Time Do You Need To Save for a Down Payment? | MyKCM

One of the biggest hurdles homebuyers face is saving for a down payment. As you’re budgeting and planning for your home purchase, you’ll want to understand how much you’ll need to put down and how long it will take you to get there. The process may actually move faster than you think.

Using data from the U.S. Department of Housing and Urban Development (HUD) and Apartment List, we can estimate how long it might take someone earning the median income and paying the median rent to save up for a down payment on a median-priced home. Since saving for a down payment can be a great time to practice budgeting for housing costs, this estimate also uses the concept that a household should not pay more than 28% of their total income on monthly housing expenses.

According to the data, the national average for the time it would take to save for a 10% down payment is right around two and a half years (2.53). Residents in Iowa can save for a down payment the fastest, doing so in just over one year (1.31). The map below illustrates this time (in years) for each state:How Much Time Do You Need To Save for a Down Payment? | MyKCM

What if you only need to save 3%?

What if you’re able to take advantage of one of the 3% down payment programs available? It’s a common misconception that you need a 20% down payment to buy a home, but there are actually more affordable options and down payment assistance programs available, especially for first-time buyers. The reality is, saving for a 3% down payment may not take several years. In fact, it could take less than a year in most states, as shown in the map below:How Much Time Do You Need To Save for a Down Payment? | MyKCM

Bottom Line

Wherever you are in the process of saving for a down payment, you may be closer to your dream home than you think. Let’s connect to explore the down payment options available in our area and how they support your plans.

Blog author image

KELLY RICKARD

I am a native Texan and real estate agent for Abby Realty in Spring, TX. I was born and raised in the Houston area; therefore, I know the city and surrounding areas well. Whether you are buying, sell....

Latest Blog Posts

What To Expect as Appraisal Gaps Grow

What To Expect as Appraisal Gaps GrowIn today’s real estate market, low inventory and high demand are driving up home prices. As many as 54% of homes are getting offers over the

Read More

Homebuyers: Hang in There [INFOGRAPHIC]

Homebuyers: Hang in There [INFOGRAPHIC]Some HighlightsToday’s sellers’ market provides unique challenges—and benefits—for buyers.Current low interest rates won

Read More

Why Pre-Approval Makes All the Difference When Buying a Home

Pre-Approval Makes All the Difference When Buying a HomeYou may have been told that it’s important to get pre-approved at the beginning of the homebuying process, but what

Read More

Hope Is on the Horizon for Today’s Housing Shortage

Hope Is on the Horizon for Today’s Housing ShortageThe major challenge in today’s housing market is that there are more buyers looking to purchase than there are homes available to buy.

Read More