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

Dated: April 20 2021

Views: 95

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.

#hybridrealestate #hybridpcs #thehybridexperience

Latest Blog Posts

Home Sellers: There Is a Hybrid Way To Welcome Home Our Veterans

Some veterans are finding it difficult to obtain a home in today’s market. According to the National Association of Realtors (NAR):“Conventional conforming

Read More

4 Reasons Why the End of Forbearance May Not Lead to a Wave of Foreclosures

With forbearance plans about to come to an end, many are concerned the housing market will experience a wave of foreclosures like what happened after the housing bubble 15 years ago. Here are four

Read More

A Look at 2021 Housing Supply and What It Means for Sellers

One of the hottest topics of conversation in today’s real estate market is the shortage of available homes. Simply put, there are many more potential buyers than there are homes for

Read More

3 Hot Topics in the 2021 Summer Housing Market

If you’re a prospective buyer or seller, it’s important to understand the current real estate market conditions and how they affect you. The Counselors of Real Estate (CRE);

Read More