ADVERTISEMENT
  • News
  • New York
  • Technology
  • Culture
  • Entertainment
  • Sport
  • More
    • Politics
    • Lifestyle
    • TV
    • Games
Tuesday, June 24, 2025
  • Login
No Result
View All Result
NEWSLETTER
FINCHANNEL
  • Home
  • Business
    • BANKS
      • GeoBanks
    • Finance
    • Insurance
    • Markets
    • Pharmacy
    • Press Releases
    • RealEstate
    • RealEstate
    • Finance
    • Insurance
    • Banks
      • GeoBanks
    • Markets
    • Press Releases
    • Personal Finance
  • World
    • Americas
    • Europe
    • Georgia
      • Media
    • Ukraine
    • Europe
    • Georgia
      • Media
    • Ukraine
    • Americas
    • UK local news
  • Travel
    • Hotels in Georgia
    • Tours in Georgia
  • Videos
    • Promos
    • Soundslides
    • TheClinics
    • TheHoteliers
    • TheUniversities
    • TheHoteliers
    • TheClinics
    • TheUniversities
    • BestWorkplaces
    • Soundslides
    • Promos
    • Banking Forum
      • Promos
      • Soundslides
      • TheClinics
      • TheHoteliers
      • TheUniversities
  • Opinion
    • Editorial
      • Analysis
      • GORBI
      • OP-ED
      • VISA Editorial
    • Analysis
    • Gorbi
    • Book reviews
  • Tech
  • Interview
  • People
    • lifestyle
    • Health & Beauty
      • Coronavirus
    • LifeStyle
    • Employment
      • MyCareer
    • Education
    • Media
    • Celebrities
  • Oil&Auto
    • Auto
    • Energy
  • EN
    • EN
    • GE
  • Home
  • Business
    • BANKS
      • GeoBanks
    • Finance
    • Insurance
    • Markets
    • Pharmacy
    • Press Releases
    • RealEstate
    • RealEstate
    • Finance
    • Insurance
    • Banks
      • GeoBanks
    • Markets
    • Press Releases
    • Personal Finance
  • World
    • Americas
    • Europe
    • Georgia
      • Media
    • Ukraine
    • Europe
    • Georgia
      • Media
    • Ukraine
    • Americas
    • UK local news
  • Travel
    • Hotels in Georgia
    • Tours in Georgia
  • Videos
    • Promos
    • Soundslides
    • TheClinics
    • TheHoteliers
    • TheUniversities
    • TheHoteliers
    • TheClinics
    • TheUniversities
    • BestWorkplaces
    • Soundslides
    • Promos
    • Banking Forum
      • Promos
      • Soundslides
      • TheClinics
      • TheHoteliers
      • TheUniversities
  • Opinion
    • Editorial
      • Analysis
      • GORBI
      • OP-ED
      • VISA Editorial
    • Analysis
    • Gorbi
    • Book reviews
  • Tech
  • Interview
  • People
    • lifestyle
    • Health & Beauty
      • Coronavirus
    • LifeStyle
    • Employment
      • MyCareer
    • Education
    • Media
    • Celebrities
  • Oil&Auto
    • Auto
    • Energy
  • EN
    • EN
    • GE
No Result
View All Result
FINCHANNEL
No Result
View All Result
Home Business RealEstate

Low mortgage rates are easing affordability, but down payments are further from reach

The FINANCIAL by The FINANCIAL
October 29, 2020
in RealEstate
Reading Time: 17 mins read
8
A A
0
Share on FacebookShare on Twitter

The FINANCIAL — Monthly mortgage payments are becoming increasingly affordable for U.S. homeowners as mortgage rates have hit record lows, a new Zillow® analysis shows. But that masks the difficulties would-be buyers face in getting into homes in the first place after extraordinary price growth has pushed prices further above incomes than they’ve been in at least the past several years. 

Homeowner households earning the median income paid 17.5% of their earnings toward a mortgage on the typical U.S. home in September, down from 19.6% two years earlierii. That affordability improvement is thanks to record-low mortgage rates, which have dipped as low as 2.8% this month, down from around 4.85% in October 2018iii. 

While more affordable monthly payments are a benefit to millions of homeowners nationwide, these rosy statistics obscure the effect of soaring home prices that have outpaced incomes by an alarming level in recent years. Saving for a down payment is a massive financial barrier for potential buyers, especially first-time buyers. More than a quarter of first-time buyers report difficulties saving for a down payment, and 40% of all buyers rely on a gift or loan from family or friends for at least part of their down paymentiv. 

RelatedPosts

Tips for Remodeling on a Budget

Why Tbilisi Real Estate Investing is Buzzing Right Now

Two Men Sentenced for Real Estate and Tax Fraud

Tariffs Spur Home Improvement Shock: ‘Prices to Skyrocket,’ Expert Warns

That hurdle has gotten higher after home values have grown 38.3% since September 2014, while homeowner incomes have grown just less than half that amount (18.8%) over the same period. A typical U.S. home is now worth more than three times the median annual homeowner income, the highest it’s been since at least 2014, when Zillow’s analysis began. In January 2014, the typical home was worth about 2.6 times the median homeowner income. 

Put another way, we can look at the difference in a 20% down payment over the years. Putting 20% down on the typical home would have taken about $36,600 at the start of 2014, or 6.4 months of income for the median homeowner household. Now, that would be a roughly $52,000 down payment, which is 7.5 months of income. Zillow expects the typical U.S. home to appreciate by 7% over the next year, which would bring that down payment up another $3,600 to about $55,600. Nearly 40% of buyers with a mortgage put at least 20% downiv, which allows a buyer to avoid private mortgage insurance premiums.

“The path to homeownership, and the savings and wealth-creation benefits that come with it, has gotten harder for many buyers,” said Zillow senior economist Chris Glynn. “Saving for a down payment is the single biggest challenge many potential home buyers face, and it is especially difficult when incomes fail to keep pace with home values. Even still, many buyers sense that prices will slip further out of reach in coming years and desperately want to lock in low mortgage rates while they can, which is likely contributing to the urgency we’re seeing in the market. The current environment is a double win for longtime homeowners who have enjoyed big equity gains and are now able to refinance their mortgage to lower their monthly payments.”

Among the 50 largest U.S. metros, down payments are most in reach for potential buyers in Cleveland, where a 20% down payment on the typical home is equal to 5.1 months of income for the median homeowner household. Milwaukee, Pittsburgh and Memphis have the next most affordable homes by this measure, each at 5.2 months of income. Homes are most difficult to save for in high-priced California metros, led by San Francisco (17.1 months of income), San Jose (16.1), Los Angeles (14.9) and San Diego (13.2). 

See also  Looking For A New Property? Here Are 10 Things You Need To Consider During The Hunt

At current rates, mortgage payments are most affordable in Louisville (12.3% of income), Birmingham (12.5%) and Indianapolis (12.7%). They are the most burdensome in San Francisco (34.4%), San Jose (31.6%) and Los Angeles (29.9%). 

Had pre-pandemic trends held, renters were projected to spend 29.9% of their income on rent in September, the lowest share since at least 2014. But because renters have been hit hard by income loss during the coronavirus pandemic, it’s likely the share is considerably higher. The spread between rent and mortgage affordability illustrates the financial benefits of homeownership — the ability to build equity, often while also spending relatively less on monthly housing payments, is a key avenue for building long-term wealth. 

Metropolitan Area*

Typical Home Value –  September 2020

Mortgage Affordability – September 2020

Median Monthly Homeowner Income – September 2020

 Estimate

Estimated Monthly Payment on Typical Home

United States

$259,906

17.5%

$6,973

$1,217

New York, NY

$497,090

23.9%

$9,923

$2,375

Los Angeles, CA

$711,361

29.9%

$9,555

$2,854

Chicago, IL

$253,512

16.4%

$8,149

$1,336

Dallas-Fort Worth, TX

$270,907

17.7%

$8,288

$1,466

Philadelphia, PA

$265,912

16.0%

$8,253

$1,317

Houston, TX

$228,576

16.1%

$7,841

$1,261

Washington, DC

$455,038

16.8%

$11,484

$1,934

Miami-Fort Lauderdale, FL

$308,911

22.9%

$6,512

$1,491

Atlanta, GA

$252,586

14.4%

$7,921

$1,137

Boston, MA

$520,206

22.4%

$10,463

$2,341

San Francisco, CA

$1,113,664

34.4%

$13,031

$4,480

Detroit, MI

$193,270

14.8%

$6,580

$973

Riverside, CA

$404,320

23.8%

$7,358

$1,750

Phoenix, AZ

$309,543

17.7%

$7,125

$1,264

Seattle, WA

$555,689

23.0%

$10,221

$2,350

Minneapolis-St. Paul, MN

$307,156

16.9%

$8,583

$1,448

San Diego, CA

$632,264

26.7%

$9,597

$2,559

St. Louis, MO

$188,845

13.5%

$6,901

$930

Tampa, FL

$236,574

19.1%

$5,978

$1,139

Baltimore, MD

$307,675

15.0%

$9,076

$1,359

Denver, CO

$462,724

21.8%

$8,782

$1,911

Pittsburgh, PA

$172,719

13.2%

$6,590

$867

Portland, OR

$436,053

21.6%

$8,756

$1,893

Charlotte, NC

$254,932

16.4%

$6,785

$1,115

Sacramento, CA

$449,280

21.5%

$8,816

$1,896

San Antonio, TX

$221,860

18.2%

$6,424

$1,171

Orlando, FL

$266,724

17.9%

$7,001

$1,251

Cincinnati, OH

$201,822

13.7%

$7,258

$990

Cleveland, OH

$166,936

13.4%

$6,561

$880

Kansas City, MO

$218,314

14.3%

$7,475

$1,070

Las Vegas, NV

$302,133

17.8%

$7,035

$1,249

Columbus, OH

$223,010

15.3%

$7,474

$1,147

Indianapolis, IN

$199,477

12.7%

$7,210

$912

San Jose, CA

$1,219,074

31.6%

$15,176

$4,797

Austin, TX

$365,091

19.4%

$9,566

$1,851

Virginia Beach, VA

$257,117

15.3%

$7,373

$1,131

Nashville, TN

$295,317

17.4%

$7,311

$1,273

Providence, RI

$338,536

20.2%

$8,054

$1,623

Milwaukee, WI

$200,213

13.2%

$7,749

$1,023

Jacksonville, FL

$242,663

16.6%

$6,779

$1,128

Memphis, TN

$165,614

12.9%

$6,316

$812

Oklahoma City, OK

$170,113

13.5%

$6,327

$851

Louisville, KY

$190,184

12.3%

$7,054

$867

Hartford, CT

$246,266

15.4%

$8,482

$1,309

Richmond, VA

$259,290

15.1%

$7,318

$1,108

New Orleans, LA

$215,442

17.2%

$5,902

$1,013

Buffalo, NY

$186,292

15.0%

$6,914

$1,038

Raleigh, NC

$299,061

15.2%

$8,538

$1,301

Birmingham, AL

$181,968

12.5%

$6,162

$769

Salt Lake City, UT

$411,548

20.5%

$8,198

$1,676

*Table ordered by market size 

Tags: homeownershiphousinghousinghousing marketloanmortgagemortgage insurancemortgage loanmortgage ratesprivate mortgage insuranceReal EstaterentUSAzillow

Related Posts

Tips for Remodeling on a Budget
Business

Tips for Remodeling on a Budget

by The FINANCIAL
June 17, 2025
0

Overdue for a change? You’re not alone. Remote work trends coupled with a red-hot housing market have many looking to...

Read more
Why Tbilisi Real Estate Investing is Buzzing Right Now

Why Tbilisi Real Estate Investing is Buzzing Right Now

June 3, 2025
Brooklyn Park Man Pleads Guilty to His Role in $250 Million Feeding Our Future Fraud Scheme

Two Men Sentenced for Real Estate and Tax Fraud

May 16, 2025
Homes Sold Faster than Ever in 2017

Tariffs Spur Home Improvement Shock: ‘Prices to Skyrocket,’ Expert Warns

May 7, 2025

Discussion about this post

  • Trending
  • Comments
  • Latest
Teaching porn literacy

A sizable percentage of internet porn users, roughly 40% are women

January 17, 2024
EasyJet to fly to London from Stockholm Arlanda

The London Diplomatic List, Addresses, Contacts & Working Hours

January 23, 2023
Ampersand wins £22m five-year contract at London Zoo

Ampersand wins £22m five-year contract at London Zoo

June 25, 2012
Matthew H. Fleeger Drives Strategic Growth at Gulf Coast Western Through Technology Integration

Matthew H. Fleeger Drives Strategic Growth at Gulf Coast Western Through Technology Integration

June 19, 2025
Teaching porn literacy

Teaching porn literacy

January 17, 2024
Charged With Retail Theft? What to Know Before Court

Charged With Retail Theft? What to Know Before Court

June 24, 2025
Jewish General Hospital, Montreal is the first hospitals in the world to fully implement EIAS across all surgical disciplines

Jewish General Hospital, Montreal is the first hospitals in the world to fully implement EIAS across all surgical disciplines

June 24, 2025
Survey: Majority of CFOs prioritizing ESG investment

The CFO’s Five Hidden Cyber-Cost Centers (and How to Shrink Them)

June 24, 2025
President of Ukraine. Stop Russia

Ukrainian President to make first visit to Council of Europe in Strasbourg amid escalating war in Ukraine

June 23, 2025
Energy Management in Facilities: Tools for Calculating Efficiency

Energy Management in Facilities: Tools for Calculating Efficiency

June 23, 2025
ADVERTISEMENT

Popular Last 24h

  • Teaching porn literacy

    A sizable percentage of internet porn users, roughly 40% are women

    332 shares
    Share 133 Tweet 83
  • Ampersand wins £22m five-year contract at London Zoo

    3723 shares
    Share 1489 Tweet 931
  • Osman Gunes Cizmeci on Apple’s Liquid Glass: Beautiful, But at What Cost?

    25 shares
    Share 10 Tweet 6
  • Levi Pettit Launches Dornick Wealth Management With a Personalized Approach to Client Relationships

    21 shares
    Share 8 Tweet 5
  • Leon Botstein’s Five-Decade Transformation at Bard College

    357 shares
    Share 143 Tweet 89
  • Teaching porn literacy

    163 shares
    Share 65 Tweet 41
  • Ukrainian President to make first visit to Council of Europe in Strasbourg amid escalating war in Ukraine

    19 shares
    Share 8 Tweet 5

LATEST POSTS

Charged With Retail Theft? What to Know Before Court

Charged With Retail Theft? What to Know Before Court

June 24, 2025
Jewish General Hospital, Montreal is the first hospitals in the world to fully implement EIAS across all surgical disciplines

Jewish General Hospital, Montreal is the first hospitals in the world to fully implement EIAS across all surgical disciplines

June 24, 2025
Survey: Majority of CFOs prioritizing ESG investment

The CFO’s Five Hidden Cyber-Cost Centers (and How to Shrink Them)

June 24, 2025
President of Ukraine. Stop Russia

Ukrainian President to make first visit to Council of Europe in Strasbourg amid escalating war in Ukraine

June 23, 2025
Energy Management in Facilities: Tools for Calculating Efficiency

Energy Management in Facilities: Tools for Calculating Efficiency

June 23, 2025
Levi Pettit Launches Dornick Wealth Management With a Personalized Approach to Client Relationships

Levi Pettit Launches Dornick Wealth Management With a Personalized Approach to Client Relationships

June 23, 2025
Osman Gunes Cizmeci on Apple’s Liquid Glass: Beautiful, But at What Cost?

Osman Gunes Cizmeci on Apple’s Liquid Glass: Beautiful, But at What Cost?

June 23, 2025
In the U.S. and abroad, more young adults are living with their parents

Why More Adults Are Reconsidering Old Habits in 2025

June 23, 2025
CityBlue Hotels opens its first Beach Property in Kenya

CityBlue Hotels opens its first Beach Property in Kenya

June 19, 2025
65% of Europeans see EU membership as a good thing, the highest result since 2007 

The Enchantment of Ukrainian Women and Building Bridges through Luludate

June 19, 2025

LATESTBUSINESS

Valor Hospitality Partners announces two significant deals in West Africa,

Valor Hospitality Partners announces two significant deals in West Africa,

by The FINANCIAL
June 19, 2025
0

Markets will drop quickly if US enters Israel-Iran conflict: deVere CEO

Markets will drop quickly if US enters Israel-Iran conflict: deVere CEO

by The FINANCIAL
June 19, 2025
0

Matthew H. Fleeger Drives Strategic Growth at Gulf Coast Western Through Technology Integration

Matthew H. Fleeger Drives Strategic Growth at Gulf Coast Western Through Technology Integration

by The FINANCIAL
June 19, 2025
0

Iconiq 777 Hosts Pathways to Apprenticeship Awards Ceremony in Newark

Iconiq 777 Hosts Pathways to Apprenticeship Awards Ceremony in Newark

by The FINANCIAL
June 17, 2025
0

Tips for Remodeling on a Budget

Tips for Remodeling on a Budget

by The FINANCIAL
June 17, 2025
0

 ‘Why Did My Car Insurance Go Up for No Reason?’

Insurers boost private assets allocations as capital increases

by The FINANCIAL
June 17, 2025
0

Elite Lauches in Lebanon

U.S. Counts 1,873 Listed Billion-Dollar Companies, More Than the Next Eight Economies Combined

by The FINANCIAL
June 17, 2025
0

7 Digital Marketing Techniques for Business Owners in 2020

Lockton Surprasses $4 Billion in FY2025 revenue

by The FINANCIAL
June 16, 2025
0

GET IN TOUCH

Submit guest post/Letters to the Editor:

editor (at) finchannel.com

Sales & Marketing: (+995 558) 03 03 03 Email: marketing (at) finchannel.com

Whatsup: (+995 599) 96 52 52

Georgia:

(+995 599) 96 52 52 Email: editor (@) finchannel.com

Postal address: 17 Mtskheta str. Tbilisi, Georgia 0179 The FINANCIAL

RESOURCE

  • Work at the FINANCIAL
  • ePaper
  • Advertise in The FINANCIAL
  • Access ePaper
  • Guest posts
  • Contributed articles
  • AmericanStockNews
  • Coupon Codes
  • GLOSSY MAG
American Culture Center
ACC Partner

GUIDEBOOK

  • Meet our team
  • Invest in Georgia
  • Become contributor
  • Archive

FOLLOW US

  • Facebook
  • Twitter
  • Google+
  • Youtube
No Result
View All Result
  • Home
  • Business
    • BANKS
      • GeoBanks
    • Finance
    • Insurance
    • Markets
    • Pharmacy
    • Press Releases
    • RealEstate
    • RealEstate
    • Finance
    • Insurance
    • Banks
      • GeoBanks
    • Markets
    • Press Releases
    • Personal Finance
  • World
    • Americas
    • Europe
    • Georgia
      • Media
    • Ukraine
    • Europe
    • Georgia
      • Media
    • Ukraine
    • Americas
    • UK local news
  • Travel
    • Hotels in Georgia
    • Tours in Georgia
  • Videos
    • Promos
    • Soundslides
    • TheClinics
    • TheHoteliers
    • TheUniversities
    • TheHoteliers
    • TheClinics
    • TheUniversities
    • BestWorkplaces
    • Soundslides
    • Promos
    • Banking Forum
      • Promos
      • Soundslides
      • TheClinics
      • TheHoteliers
      • TheUniversities
  • Opinion
    • Editorial
      • Analysis
      • GORBI
      • OP-ED
      • VISA Editorial
    • Analysis
    • Gorbi
    • Book reviews
  • Tech
  • Interview
  • People
    • lifestyle
    • Health & Beauty
      • Coronavirus
    • LifeStyle
    • Employment
      • MyCareer
    • Education
    • Media
    • Celebrities
  • Oil&Auto
    • Auto
    • Energy
  • EN
    • EN
    • GE

© 2025 Intelligence Group llc

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.