Down payments are dropping from historic highs — see how much you can save today

Homebuyers might be relieved to hear that🌠 from recent historic highs.

A new  shows that the median down payment homebuyers plunked down from July to September of 2024 was an average of 14.5%—or $30🌠,300.

That’s a $2,400 saviꦐngs from lღast quarter’s historic peak of $32,700 (14.9%).

So why are down payments dropping? Fewer homebuyers are out there, wꦆhich gives those who do brave today’s market more leverage, acco💧rding to Realtor.com senior economic research analyst Hannah Jones.

“The annual decl⛄ine in down payments is the result of less buyer competition in the third quarter,” Jones says. “Easing demand and increasing inventory gave buyers more flexibility last qua꧑rter, which led to slightly lower down payments.”

To produce these findings, the Realtor.com economic research team examined down payment trends throughout the U.S., individual states, and the top 150 metropolitan areas up toꦉ the third quarter of 2024, using data from Optimal Blue. The team then determined the down payment as a percentage of the sale price by averaging ๊the data.

States with the biggest down payment declines

Down payment dollar amounts🍰 fell in 21 states in the third quarter of 2024.

The states that saw the biggest down payment declines include COVID-19 pandemic-era ho✅t ꧙spots such as  and .

These states “have seen significant softening over the last year as wani🐷ng demand and climbing inve🤡ntory impact home prices and reduce competition,” says Jones.

The five states with the biggest down payment declines were Florida, down 24% year over year, to $27,000; Texas, down 23.2%, to $14,400; , down 22.3%, to $25,200; the , down 17.7%, to $81,300; an෴d , down 16.4%, to $31,400.

Metros with the smallest down payments

“Overall, the metros with the smallest down payments tend to be relatively affordable and flush with inventory,” ✱says Jones.

Housing stock was between 19% and 37% more abundant in these metros compared with one year ago, and homes were 𝓀spending more time on t🦋he market.

The median list price in each of these markets was more than $30,000 below the national median, enabling low🅘er down payments, according to Jones.

The top two markets with the smallest down payments are  and  which are both military markets. In markets with a high military population, bu🅘🎶yers are more likely to , which can allow for as little as a $0 down payment.

In San Antonio, 🔯the average down payment in the third quarter of 2024 was $5,200, or 7.4%. That’s dওown $900 year over year.

The average down payment in Virginia Beach was 9.1%, or $7,300—which is actually $600 higher than the same time last year.

Rounding out the top five metros with lowest down payments were , with an average down payment of $8,300 (down 9.8%, or $2,500, year over year); , with an average down pa𝔍yment of $13,500 (up 11.2%, or $3,000, year over year); and , with an a💧verage down payment of $17,500 (down 11.8%, or $2,000, year over year).

States with the biggest down payment increases

The top five🧸 states with the largest annual down payment in✱creases were all in the Northeast and Midwest.

“Northeast and Midwest markets have been heavily represented in recent🅰 , confirming that buyer demand is driving competition and prices higher, resulting in higher down payments,” says Jones.

In dollar amounts,  saw the largest spike in down payment, with the typical down paym🍨ent going from $45,300 to $60,400 year over year—an increase of $15,000 (33.8%).

In , the🍨 typꦰical down payment went from $40,400 to $53,600—which was an increase of $13,200 (32.8%).

‘s typical down payment went from $28,300 to $35,500—which was an increase o♔f $7,200 (25.2%).

In , the typical down payment went from $33,300 to $40,900—which was an inc𝓀rease of $7,600 (22.8%)🍌.

Finally, ‘s typical down payment෴ went from $15,100 to $18,500—an increase 💫of $3,400 (22.8%).

Metros with the largest down payments

Four out of 🍒five metr🌼os with the highest down payment amounts are in California, which includes some of the most expensive housing markets in the country.

“These pricey metros tend to see large down payments as both inter🎃est rates and interest payments increase with larger loan amounts, incentivizing buyers to put down as much as possible to avoid these costs,” says Jones.

 continues to be the metro with the largest median down payment꧒, with the average homebuyer putting down about $312,000, or 27.7% of the purchas🎉e price. That’s nearly a $76,000 increase from the same quarter last year—when buyers put 24.8% down.

In August, the median price of a single-family home in San Jose , marking the first instance that 🐬a city has reached such a milestone since the Nat🐓ional Association of Realtors® began tracking this data in 1979.

The other California metros in the top five🍸 we♒re , at No. 2; , at No. 3; and , at No. 5.

In San Francisco, buyers put down an average of $231,400 on a house, or 25%. That’s $28,900 more than the same time last൲ year.

Homebuyers put down an average of $109ꦿ,000, or 21.0%, in Sacramento. That’s a difference o🔴f $5,200 year over year.

In 🀅Los Angeles, buyers put down an average of 20.9%, or $159,700. That’s $7,400 higher than the thir♓d quarter of last year.

, at No. 4, stands out on this list of high-priced California markets. Buyerꦜs in Beantown put 20.9%, or $109,000, down on average—which w🀅as $2,000 more than last year.

“These high-priced locales te🎀ndꩲ to have wealthier, high-earning residents who have the funds to put more down on a home,” says Jones.

The future of down payments

Al🍌though down payments have started to trend lower, they remain historically high.

“With many buyers opting out of the home purchase market altogether, those left are likely better positioned to🤪 make a larger down payment, 💞and incentivized to do so by high mortgage rates,” says Jones.

As mortgage rates ease, mor𒆙e buyers will likely enter the market, and the incentive to minimize their home loan will softℱen.

“However, if for-sale inventory fails to keep up with increased buyer demand, down payments could climbꦺ once again,” says Jones.