News (US:NWS) Prnewswire·2025-03-27 11:55Core Insights - The typical down payment in Q4 2024 was $30,250, slightly below Q3 but $3,000 higher than the previous year, marking the highest down payments in history both in dollar amount and as a share of purchase price [1][2] - Down payments in 2024 averaged 14.4% of the purchase price, up from 14.2% in 2023, indicating a trend towards larger down payments as the market remains skewed towards higher-end homes [2] Down Payment Trends - Homebuyers are utilizing pandemic-era savings, which peaked at over 30% of disposable income during the pandemic, to make larger down payments [3] - Despite a lower savings rate post-pandemic, the typical down payment amount remains more than double the pre-pandemic median, with a share of purchase price over 3 percentage points higher than before [4] - Accumulated pandemic savings and high existing home equity are aiding buyers in making substantial down payments [5] Market Segmentation - Housing activity is increasing in the high-priced segment ($750,000+), with a 7.4% rise in sales, while lower-priced segments are declining by 9.3% [6] - Modest down payments, typically used by first-time buyers or those using government-backed loans, have increased but remain below pandemic peaks [7] - The 30th percentile down payment in Q4 2024 was $8,200, up 6.5% year-over-year but down from a peak of $10,300 in Q2 2022, indicating a competitive market environment [8] Future Outlook - As mortgage rates ease, a more diverse range of buyers may enter the market, potentially reducing the incentive to minimize home loans; however, if inventory does not keep pace with demand, down payments could rise again due to increased competition [9]