The path to homeownership: Understanding down payment assistance

Zillow research underscores the role that down payment assistance can play in putting homeownership within reach

On the road to homeownership, one of the biggest obstacles home shoppers face is securing the down payment. That’s why it’s essential for home buyers to know about all of the resources available that can assist them. 

In today’s real estate landscape, characterized by volatile interest rates and elevated home values, how much a buyer has saved for a down payment can determine whether a home is within reach or out of their grasp. According to new Zillow research, a home buyer making the median income now needs to put down nearly $128,000 to afford a typical home — that down payment would take about 12 years to save.¹

That is a tall task to take on without outside help. Zillow survey data found that 43% of last year’s buyers used a gift from family or friends for at least part of their down payment. Down payment assistance is often overlooked, which is why Zillow displays down payment assistance information on every for-sale listing to better arm home shoppers with the resources they need to secure their dream home. 

Understanding down payment assistance

Down payment assistance is a form of financial aid that helps home buyers cover the upfront payment required when purchasing a home. This assistance comes in various forms, such as grants, loans or other programs, and is designed to make homeownership more accessible by reducing the initial financial burden on buyers. 

Where to access down payment assistance information

Thanks to a longstanding partnership with Down Payment Resource, Zillow publishes down payment assistance information on all for-sale listings. Prospective home shoppers can enter basic information into the comprehensive database, which generates a list of potentially available programs. Buyers will receive details specific to their personal situation, along with resource links to learn more.

Using a down payment assistance program can help home shoppers qualify for a loan, lower mortgage payments, build home equity faster and even purchase a home sooner. Across the 50 biggest U.S. metro areas, the average amount of down payment assistance that a qualified buyer can receive ranges from about $8,000 in Pittsburgh to more than $63,000 in San Jose, according to data from Down Payment Resource. Such amounts can help a buyer on the cusp of affording a home get across the finish line and into homeownership. 

¹ Assuming 10% is saved each month with a 4% return. 

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