Rising home prices lead to bigger down payments
As a consequence of rising home prices, the down payment to purchase a home is climbing as well. According to a new report from LendingTree, the average down payment in the U.S. is currently $46,283. However, in some high-priced metropolitan areas, like San Diego, median down payments are far greater.
In fact, San Diego ranked third on the list of metros with the highest average down payment with $85,714 or 102 percent of the median annual household income of $83,985. This follows San Jose at $115,138 and San Francisco at $103,016.
Fortunately, down payments of this size are not required to purchase a home. Low down payment home loans, like those offered through the FHA, allow buyers to buy a property with as little as 3.5 percent down.
Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 2.75 percent and 15-year rates are near 2.00 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.