Market Updates • January 14, 2025

Year-End Reflections and Looking Ahead – January 2024 Denver Metro Market Update

by LaDawn Sperling

As 2024 draws to a close, we reflect on a year marked by fluctuations and adjustments within the Denver Metro real estate market. Despite early optimism for decreasing mortgage rates and easing inflation, the market experienced a rollercoaster ride influenced by economic events and policy decisions. Here’s how these dynamics played out in December and what we can anticipate as we step into 2025.

December Market Overview:

Active Listings: Ended the year at 6,888, a significant drop of 26.02% from November but still up 38.56% compared to December last year, showing increased availability but a seasonal slowdown in listings.
New Listings: Decreased sharply by 32.97% to 1,840, reflective of typical end-of-year market behavior combined with ongoing economic uncertainties.
Pending Sales: Also saw a reduction, down 15.59% to 2,459, as buyers and sellers paused their activities amidst the holiday season and year-end reflections.
Closed Sales: Slightly down by 0.89% from November to 3,107, closing the year with an overall increase of 13.15% compared to last December.

The median days on MLS rose to 40 days, up significantly from November, indicating properties are taking longer to sell as buyers take a more measured approach in the current economic climate.

Year-Over-Year Insights:

Detached Homes: Continued to show strength with active listings up 32.27% for the year. Closed sales increased by 22.18% compared to last December, reflecting sustained demand despite the broader market challenges.
Attached Homes: Faced tougher conditions with a significant year-over-year increase in active listings and a decrease in closed sales, indicating a shift in buyer preferences or challenges in affordability due to rising HOA costs.

Economic Influences: The end of 2024 was shaped by key economic reports and a critical Federal Reserve decision, which saw the federal funds rate decrease in the latter half of the year. However, mortgage rates didn’t see a sustained benefit from these cuts, closing the year in the high six percent range. This stabilization at a higher rate level than anticipated has required buyers and sellers to adjust their expectations and strategies accordingly.

Market Trends and 2025 Outlook: Looking ahead to 2025, the market is expected to continue adjusting to the new normal of higher interest rates and economic shifts. The inventory levels, while lower than in November, remain elevated compared to the past few years, providing opportunities for buyers. Sellers may need to adjust to longer selling times and be open to negotiations to align with buyer expectations.

As we enter a new year, the market’s resilience and the adaptability of both buyers and sellers will be key. Economic and political changes will continue to influence market dynamics, and staying informed will be crucial for successful real estate decisions.

Navigating the Market: Whether planning to buy or sell in 2025, understanding the nuanced changes in market conditions is essential. As your real estate advisor, I’m here to provide you with the latest data and insights to help you make informed decisions.

Contact Me for More Insights: If you’re looking to navigate the complexities of the real estate market, whether buying, selling, or just staying informed, don’t hesitate to reach out.

Contact Me: LaDawn Sperling, Real Estate Professional 303.710.5817 | ladawn.sperling@cbrealty.com

Real Estate News, Tips, & Tricks • December 19, 2024

The Biggest Perks of Buying a Home This Winter

by LaDawn Sperling

Waiting for perfect market conditions often means missing out. Because what you may not realize is, if you’re ready and able to buy, this time of year could actually give you an edge. Here’s why. As the weather cools down, the housing market can too – and that works in your favor.

You Likely Won’t Feel as Rushed

Homes tend to take a little longer to sell during this time of year. Data from the National Association of Realtors (NAR) shows the average time a house sits on the market jumps up during the winter months (see the green bars in the graph below):

This is partly because fewer buyers are active at this time of year – and that decrease in buyer competition means the houses that are on the market aren’t going to be snatched up as quickly. So, if you decide to buy a home in the next couple of months, you’ll likely have more time to consider your options and negotiate a deal without feeling as pressured.

Sellers May Be More Willing To Negotiate

And since homes generally take longer to sell during the winter, sellers are often more motivated to close a deal. That can work in your favor, too. According to NAR:

“Less competition can lead to better deals. While homes are not selling as fast as during the summer, sellers may be more willing to negotiate.”

Whether it’s compromising on price, covering closing costs or repairs, or including extras like appliances, you have more room to ask for what you need.

Homes Are Less Expensive in the Winter

With less competition from other buyers and sellers who are more willing to negotiate, you may see slightly lower prices too. In fact, according to NAR, homes are typically about 5% less expensive now compared to when prices normally peak in the summer.

That might not seem like a huge difference, but on a $400,000 home, it could mean savings of $20,000 on the purchase price.

You can see this expected seasonal shift in home prices taking place this year. Take a look at the graph below showing the median sales price of existing homes (homes that were previously owned) over the past 12 months. You’ll notice in the green bars that prices were lower in the winter months last year, and it seems like that’s going to happen again this year. That gives you the chance to make your budget go further:

Bottom Line

Buying a home during the winter means less competition, motivated sellers, and potentially lower prices, too. Let’s work together to find the right one at the right price for you.

Market Updates • December 16, 2024

Reflecting on November’s Market Dynamics – Denver Metro Market Update

by LaDawn Sperling

As we navigated through November, the Denver Metro real estate market experienced fluctuations influenced by significant economic events. The landscape this month mirrored the broader national uncertainty, marked by key economic reports and a pivotal presidential election. Here’s a closer look at how these factors shaped the market dynamics this month. November Market Overview:

Active Listings: Decreased by 14.90% from October, ending at 9,310 homes. This reduction is typical for this time of year but still represents a significant 39.29% increase from last November, indicating more options are available for buyers.
New Listings: Dropped sharply by 41.47% to 2,747, as sellers possibly delayed listing decisions until post-election, reflecting a slight 0.96% increase year-over-year.
Pending Sales: Decreased by 10.54% month-over-month to 3,039, yet up 21.95% from last year, showing continued buyer interest despite rising mortgage rates.
Closed Sales: Saw a decrease of 16.54% to 3,022, influenced by the election and economic data releases, but rose 6.04% compared to last November.
The median days on the market increased to 29 days, up from 26 last month, and the close-price-to-list-price ratio slightly declined, indicating buyers are negotiating more aggressively in the current environment.

Segment-Specific Insights: Detached Homes: There was a notable decrease in activity with a 15.99% reduction in active listings and a 16.86% drop in closed sales. However, the median sale price showed a modest increase, indicating that value remains in the detached homes market.

Attached Homes: Active listings decreased by 12.56%, and closed sales fell by 15.45%, reflecting similar trends to the detached segment. The median sale price increased slightly, suggesting stable interest in this segment.

Economic Impacts and Market Sentiment: The Federal Reserve’s rate cut earlier in the month did not immediately translate into increased buying activity, as the market absorbed the implications of other economic indicators and the election results. However, with about 50% of the homes sold having at least one price reduction and a significant number of sellers offering concessions, buyers found favorable conditions which could continue into December. Looking Ahead: As we move into the holiday season, market activity typically slows, but the high year-over-year increase in inventory provides unique opportunities for buyers. Sellers might need to adjust expectations as homes take longer to sell, but the market’s resilience suggests a potential rebound post-holidays, especially if the Fed’s policy leads to lower rates. Need Expert Guidance?If you’re considering buying or selling, or just want to understand how these trends affect your property’s value, I’m here to provide detailed market insights and strategic advice.

This update is based on information provided by the Denver Metro Association of Realtors® for the period of November 1, 2024, through November 30, 2024, for the following counties: Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson and Park.

Market Updates • November 15, 2024

Navigating Shifts: November 2024 Denver Metro Market Update

by LaDawn Sperling

As we delve into October’s real estate activities, the Denver Metro market presents a compelling narrative of fluctuation and adjustment. This month, we observed how brief economic stimuli and election anticipations uniquely influenced market behaviors, underscoring the complexities of current real estate dynamics. October’s Market Dynamics:

Active Listings: Slightly decreased by 1.57% from last month to 10,940 homes, yet remain 46.22% higher compared to the same period last year, emphasizing a broader availability of options for buyers.
Pending Sales: Increased modestly by 1.07% to 3,578, indicating continued buyer engagement despite the rate fluctuations and broader economic signals.
Closed Sales: Rose by 2.35% to 3,443, likely a reflection of the lower interest rates in September encouraging buyers to close on homes.
New Listings: Declined by 7.16% to 4,691, as sellers opted to wait out the pre-election uncertainty, though there’s an overall increase of 22.54% year-over-year, showing a significant rise compared to previous years.

This month’s statistics reveal a market that is balancing itself amid varying pressures. The closed sales have responded positively to the September interest rate dip, yet the broader rise in median days in MLS—from 25 to 26 days—suggests that homes are taking slightly longer to sell.

Segment-Specific Insights:

Detached Homes: Showed resilience with closed sales up by 5.99% and a noticeable improvement in sales volume, up 10.21% from the previous month. This segment’s average close price also saw a rise, indicating robust value retention.
Attached Homes: Faced challenges, with closed sales down by 8.52% and a decrease in sales volume. However, pending sales in this segment grew by 6.27%, hinting at potential rebounds.

Outlook for November: Post-election, the market is expected to gain clarity which could invigorate both buying and selling activities. Sellers might find renewed interest as buyers gain confidence with the political uncertainty resolved, potentially leading to an increase in transactions and stabilization in home prices.

Need Personalized Guidance? The market is complex, but you don’t have to navigate it alone. Whether you’re considering buying or selling, or simply want to understand how these trends affect your property values, I’m here to provide expert advice and strategic insights.

This update is based on information provided by the Denver Metro Association of Realtors® for the period of October 1, 2024, through October 31, 2024, for the following counties: Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson and Park.

Real Estate News, Tips, & Tricks • October 25, 2024

What To Expect from Mortgage Rates and Home Prices in 2025

by LaDawn Sperling

Curious about where the housing market is headed in 2025? The good news is that experts are offering some promising forecasts, especially when it comes to two key factors that directly affect your decisions: mortgage rates and home prices.

Whether you’re thinking of buying or selling, here’s a look at what the experts are saying and how it might impact your move.

Mortgage Rates Are Forecast To Come Down

One of the biggest factors likely affecting your plans is mortgage rates, and the forecast looks positive. After rising dramatically in recent years, experts project rates will ease slightly throughout the course of 2025 (see graph below):

While that decline won’t be a straight line down, the overall trend should continue over the next year. Expect a few bumps along the way, because the trajectory of rates will depend on new economic data and inflation numbers as they’re released. But don’t get too hung up on those blips and reactions from the market as they happen. Focus on the bigger picture.

Lower mortgage rates mean improving affordability. As rates come down, your monthly mortgage payment decreases, giving you more flexibility in what you can afford if you buy a home.

This shift will likely bring more buyers and sellers back into the market, though. As Charlie Dougherty, Director and Senior Economist at Wells Fargo, explains:

“Lower financing costs will likely boost demand by pulling affordability-crunched buyers off of the sidelines.”

As that happens, both inventory and competition among buyers will ramp back up. The takeaway? You can get ahead of that competition now. Lean on your agent to make sure you understand how the shifts in rates are impacting demand in your area.

Home Price Projections Show Modest Growth

While mortgage rates are expected to come down slightly, home prices are forecast to rise—but at a much more moderate pace than the market has seen in recent years.

Experts are saying home prices will grow by an average of about 2.5% nationally in 2025 (see graph below):

This is far more manageable than the rapid price increases of previous years, which saw double-digit percentage growth in some markets.

What’s behind this ongoing increase in prices? Again, it has to do with demand. As more buyers return to the market, demand will rise – but so will supply as sellers feel less rate-locked.

More buyers in markets with inventory that’s still below the norm will put upward pressure on prices. But with more homes likely to be listed, supply will help keep price growth in check. This means that while prices will rise, they’ll do so at a healthier, more sustainable pace.

Of course, these national trends may not reflect exactly what’s happening in your local market. Some areas might see faster price growth, while others could see slower gains. As Lance Lambert, Co-Founder of ResiClub, says:

“Even if the average national home price forecast for 2025 is correct, it’s possible that some regional housing markets could see mild home price declines, while some markets could still see elevated appreciation. That has been, after all, the case this year.”

Even the few markets that may see flat or slightly lower prices in 2025 have had so much appreciation in recent years – it may not have a big impact. That’s why it’s important to work with a local real estate expert who can give you a clear picture of what’s happening where you’re looking to buy or sell.

Bottom Line

With mortgage rates expected to ease and home prices projected to rise at a more moderate pace, 2025 is shaping up to be a more promising year for both buyers and sellers.

If you have any questions about how these trends might impact your plans, let’s connect. That way you’ve got someone to help you navigate the market and make the most of the opportunities ahead.

Market Updates • October 15, 2024

Seasonal Shifts and Market Adjustments – October 2024 Denver Metro Market Update

by LaDawn Sperling

As we transition into fall, the Denver Metro real estate market reflects the season’s change, revealing both subtle shifts and significant movements across various segments. This month’s metrics provide insight into how the market is adapting as we approach the final quarter of the year. Key Statistics for September 2024:

Active Listings: Increased to 11,115 homes, up 3.65% from last month and a significant 45.69% year-over-year, indicating a substantial rise in available properties. New Listings: Slightly decreased by 1.19% to 5,053, maintaining a steady flow despite the seasonal change.
Pending Sales: Saw an increase of 3.64% to 3,761, suggesting that buyer interest remains resilient.
Closed Sales: Experienced a decline of 19.18% to 3,092, a typical lagging response to previous market activities.

This month’s notable change is the median days in the MLS, which increased to 25 days, indicating that homes are taking longer to sell. Additionally, the median close price slightly decreased to $576,171, reflecting the market’s reaction to broader economic influences, including recent interest rate adjustments by the Federal Reserve.

Market Dynamics:

Detached Homes: Active listings have shown a robust year-over-year increase, signaling more choices for buyers in this segment. The market for detached homes remains competitive, though the increase in days on MLS suggests a shift towards a more balanced market.

Attached Homes: Continue to face challenges, with only a modest increase in active listings and a notable decrease in close prices. This segment’s dynamics are influenced by rising HOA fees and insurance costs, which are impacting buyer decisions.

Looking Forward: As we approach the presidential election and the holiday season, market dynamics may continue to fluctuate. Sellers considering when to list their homes might aim for the spring, historically the peak selling season. Meanwhile, buyers might find opportunities now, as homes are spending more time on the market and experiencing more price reductions.

For those navigating this market, timing and patience are key. Sellers need to be prepared for potentially longer selling periods, while buyers may benefit from the increased negotiating power and the ability to be selective.

Need Guidance? Navigating a transitioning market requires strategic insight and careful planning. Whether you’re buying or selling, I’m here to offer expert advice and support to help you make informed decisions based on the latest market trends.

This update is based on information provided by the Denver Metro Association of Realtors® for the period of September 1, 2024, through September 31, 2024, for the following counties: Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson and Park.

Uncategorized • September 20, 2024

What To Know About Closing Costs

by LaDawn Sperling

Now that you’ve decided to buy a home and are ready to make it happen, it’s a good idea to plan ahead for the costs that are a typical part of the homebuying process. And while your down payment is probably the number one expense on your mind, don’t forget about closing costs. Here’s what you need to know.

What Are Closing Costs?

Simply put, your closing costs are the additional fees and payments you have to make at closing. And while they’ll vary based on the price of the home and how it’s being financed, every buyer has these, so they shouldn’t be a surprise. It’s just that some people forget to budget for them. According to Freddie Mac, this part of the homebuying process typically includes:

Application fees
Credit report fees
Loan origination fees
Appraisal fees
Home inspection fees
Title insurance
Homeowners insurance
Survey fees
Attorney fees

Some of these are one-time expenses that are baked into your closing costs. Others, like homeowners’ insurance, are initial installment payments for ongoing responsibilities you’ll have once you take possession of the home.

How Much Are Closing Costs?

The same Freddie Mac article goes on to say:

“Closing costs vary greatly depending on your location and the price of your home. Typically, you should be prepared to pay between 2% and 5% of the home purchase price in closing fees.”

With that in mind, here’s how you can get an idea of what you’ll need to budget. Let’s say you find a home you want to purchase at today’s median price of $422,600. Based on the 2-5% Freddie Mac estimate, your closing fees could be between roughly $8,452 and $21,130.

But keep in mind, if you’re in the market for a home above or below this price range, your numbers will be higher or lower.

Tips To Reduce Your Closing Costs

If you’re wondering if there’s any way to inch that down a little bit, NerdWallet lists a few things that could help:

Negotiate with the Seller: Some sellers are willing to cover part or all of these expenses — especially since homes are staying on the market a bit longer now. Sellers may be more motivated to compromise, and you’ll find you have a bit more negotiation power. So don’t hesitate to ask them for concessions like paying for the home inspection or giving you a credit toward closing costs.
Shop Around for Home Insurance: Since rising home insurance is a challenge in many areas of the country right now, take the time to get a clear picture of all your options. Each insurance company offers their own policies and coverage, so get multiple quotes and see how they compare. Choosing a policy that provides reliable coverage at a competitive rate can make a difference.
Look into Closing Cost Assistance: Just like there are programs out there to help with your down payment, options exist to get support with closing costs too. While they’ll vary by area, there are programs for various income levels, certain professions, and specific towns or neighborhoods too. If you want to learn more, Experian says:

“Your real estate professional should be able to steer you toward applicable programs, and the U.S. Department of Housing and Urban Development (HUD) maintains a helpful resource for finding homebuying assistance programs in every state.”

Bottom Line

Planning for the fees and payments you’ll need to cover when you’re closing on your home is important – and it doesn’t have to be a big surprise. With the right experts on your side, you can make sure you’re prepared. Let’s connect so you have someone you can go to for more tips and advice.

Uncategorized • September 13, 2024

End of Summer Market Assessment – August 2024 Denver Metro Market Update

by LaDawn Sperling

As the summer concludes, the Denver Metro real estate market has shown distinctive trends that diverge from the norm, making this August an intriguing period for analysis. Let’s delve into the data to understand the current market dynamics.

Key Metrics for August 2024:

Active Listings: Reached 10,724 homes, marking a modest month-over-month increase of 1.32% and a substantial year-over-year increase of 56.37%, indicating a growing inventory that is reshaping the market.
New Listings: Experienced a slight decrease of 0.76% from the previous month, yet have shown a year-over-year increase of 4.76%, suggesting a steady return of sellers despite fluctuating market conditions.
Pending Sales: Increased by 3.74% month-over-month and 7.70% year-over-year, demonstrating continued buyer interest in the face of evolving market conditions.
Closed Sales: Decreased by 7.55% month-over-month, reflecting the typical delay between sales agreement and closing, with expectations for a rebound in the coming months.

Focused Insights:

Attached Market: Has faced challenges with increased HOA fees and insurance premiums, making transactions more complex. Active listings in this segment saw a slight increase of 0.40% month-over-month, with a significant 70.92% increase year-over-year. The median days in MLS for attached homes jumped to 26 days, emphasizing a slower market that allows for more buyer deliberation.

Detached Market: Showed a robust increase in active listings by 50.85% compared to last year. The stability in median close prices suggests a continued demand in this segment. However, the slight decrease in new listings and closed sales indicates a cautious approach from both buyers and sellers.

Market Climate: The pace of the market has allowed buyers to be more selective, leading to a lack of urgency in making offers unless properties align closely with their preferences. The OMAR Market Trends Committee notes an increase in transactions falling out of contract, likely due to buyer hesitations, lending complications, and stringent seller conditions.

Looking Ahead: As we transition into fall, the potential adjustments in mortgage rates could further influence buyer and seller behaviors. This period might offer strategic opportunities for those prepared to navigate the complexities of a transitioning market.

Navigating Market Changes: In a market that’s less driven by urgency, aligning with a knowledgeable Realtor® can provide crucial advantages. Whether you are buying or selling, accurate market analysis and strategic positioning are key to achieving your real estate goals.

Reach Out for Expert Advice: If you are contemplating a move in the current market or need insights into specific segments, I’m here to assist. Together, we can craft a strategy that reflects your objectives and the latest market conditions.

This update is based on information provided by the Denver Metro Association of Realtors® for the period up to the end of August 2024.

Real Estate News, Tips, & Tricks • September 12, 2024

Are We Heading into a Balanced Market?

by LaDawn Sperling

If you’ve been keeping an eye on the housing market over the past couple of years, you know sellers have had the upper hand. But is that going to shift now that inventory is growing? Here’s a breakdown of what you need to know.

What Is a Balanced Market?

A balanced market is generally defined as a market with about a five-to-seven-month supply of homes available for sale. In this type of market, neither buyers nor sellers have a clear advantage. Prices tend to stabilize, and there’s a healthier number of homes to choose from. And after many years when sellers had all the leverage, a more balanced market would be a welcome sight for people looking to move. The question is – is that really where the market is headed?

After starting the year with a three-month supply of homes nationally, inventory has increased to four months. That may not sound like a lot, but it means the market is getting closer to balanced – even though it’s not quite there yet. It’s important to note this increase in inventory is not leading to an oversupply that would cause a crash. Even with the growth lately, there’s still nowhere near enough supply for that to happen.

The graph below uses data from the National Association of Realtors (NAR) to give you an idea of where inventory has been in the past, and where it’s at today:

For now, this is still seller’s market territory – it’s just not as frenzied of a seller’s market as it’s been over the past few years. As Mark Fleming, Chief Economist at First American, says:

“The faster housing supply increases, the more affordability improves and the strength of a seller’s market wanes.”

What This Means for You and Your Move

Here’s how this shift impacts you and the market conditions you’ll face when you move. Lawrence Yun, Chief Economist at NAR, explains:

“Homes are sitting on the market a bit longer, and sellers are receiving fewer offers. More buyers are insisting on home inspections and appraisals, and inventory is definitively rising on a national basis.”

The graphs below use the latest data from NAR and Realtor.com to help show examples of these changes:

Homes Are Sitting on the Market Longer: Since more homes are on the market, they’re not selling quite as fast. For buyers, this means you may have more time to find the right home. For sellers, it’s important to price your house right if you want it to sell. If you don’t, buyers might choose better-priced options.

Sellers Are Receiving Fewer Offers: As a seller, you might need to be more flexible and willing to compromise on price or terms to close the deal. For buyers, you could start to face less intense competition since you have more options to choose from.

Fewer Buyers Are Waiving Inspections: As a buyer, you have more negotiation power now. And that’s why fewer buyers are waiving inspections. For sellers, this means you need to be ready to negotiate and address repair requests to keep the sale moving forward.

How a Real Estate Agent Can Help

But this is just the national picture. The type of market you’re in is going to vary a lot based on how much inventory is available. So, lean on a local real estate agent for insight into how your area stacks up.

Whether you’re buying or selling, understanding how the market is changing gives you a big advantage. Your agent has the latest data and local insights, so you know exactly what’s happening and how to navigate it.

Bottom Line

The real estate market is always changing, and it’s important to stay informed. Whether you’re buying or selling, understanding this shift toward a balanced market can help. If you have any questions or need expert advice, don’t hesitate to reach out.

Uncategorized • August 29, 2024

Today’s Biggest Housing Market Myths

by LaDawn Sperling

Have you ever heard the phrase: don’t believe everything you hear? That’s especially true if you’re thinking about buying or selling a home in today’s housing market There’s a lot of misinformation out there. And right now, making sure you have someone you can go to for trustworthy information is extra important.

If you partner with a real estate agent, they can clear up some common misconceptions and reassure you by backing them up with research-driven facts. Here are just a few misconceptions they can help disprove.

1. I’ll Get a Better Deal Once Prices Crash

If you’ve heard home prices are going to come crashing down, it’s time to look at what’s actually happening. While prices vary by local market, there’s a lot of data out there from numerous sources that shows a crash is not going to happen. Back in 2008, there was a dramatic oversupply of homes that led to prices crashing. Across the board, there’s an undersupply of homes for sale today. That makes this market a whole different scenario (see chart below):

So, if you think waiting will score you a deal, know that data shows there’s not a cash on the horizon, and waiting isn’t going to pay off the way you’d hoped.

2. I Won’t Be Able To Find Anything To Buy

If this nagging fear about finding the right home if you move is still holding you back, you probably haven’t talked with an expert real estate agent lately. Throughout the year, the supply of homes for sale has grown. Data from Realtor.com helps put this into context. While there are still fewer homes on the market than in a more normal year like 2019, inventory is still above where it was at this time last year (see graph below):

So, if you’re remembering all that media coverage about record-low supply during the pandemic, you can rest a bit easier. While the market isn’t back to normal just yet, inventory is moving in a healthier direction. And that means as your options improve, you can let go of this now outdated myth because finding a home to buy won’t feel quite so impossible anymore.

3. I Have To Wait Until I Have Enough for a 20% Down Payment

Many people still believe you need a 20% down payment to buy a home. To show just how widespread this myth is, Fannie Mae says:

“Approximately 90% of consumers overstate or don’t know the minimum required down payment for a typical mortgage.”

And if you look at the date from the National Association of Realtors (NAR), you can see the typical homeowner isn’t putting down as much as you might expect (see graph below):

First-time homebuyer are typically only putting down 6%. That’s far less than the 20% so many people think they need. And if you’re looking at that graph and you’re more focused on how the number for repeat buyers is closer to 20%, here’s what you need to realize. That’s only because they have so much equity built up in their current house that can be used to make a larger down payment for their next move.

This goes to show you don’t have to put 20% down, unless it’s specified by your loan type or lender. Many people put down a lot less. Not to mention, depending on the type of home loan you get, you may only need to put 3.5% or even 0% down So, if you’re buying your first home, you likely don’t need nearly as much for your down payment as you may think.

An Agent’s Role in Fighting Misconceptions

If you put your move on pause because you heard one or more of these myths yourself, it’s time to talk to a trusted agent. An expert agent has more data and the facts, just like this, to reassure you and help break through any misconceptions that may be holding you back.

Bottom Line

If you have questions about what you’re hearing or reading, let’s connect. You deserve to have someone you can trust to get the facts.

Coldwell Banker - South Metro

Accessibility Statement | Fair Housing Notice

© Coldwell Banker 2023 – 2025. All Rights Reserved. Coldwell Banker and the Coldwell Banker logo are trademarks of Coldwell Banker Real Estate LLC. The Coldwell Banker® System is comprised of company owned offices which are owned by a subsidiary of Anywhere Advisors LLC and franchised offices which are independently owned and operated. The Coldwell Banker System fully supports the principles of the Fair Housing Act and the Equal Opportunity Act.