What is the typical down payment percentage?

Many people still believe that they need a 20% down payment to buy a home. But that simply isn't true. According to the National Association of Realtors, the median down payment percentage for first-time buyers was 10% in 2025. (The median down payment percentage for repeat buyers was 23%.)

And if buyers are eligible for low or no-down government loan programs (FHA, USDA, VA), the required down payment can be much less than 10%.

Two important considerations:

1. A lower down payment necessarily means a higher starting mortgage amount, which also means higher monthly payments and more interest paid over the life of the mortgage, and
2. In most cases, if the down payment percentage is less than 20%, the lender will require the buyer to pay PMI (private mortgage insurance) to protect the lender against non-payment.

How do buyers fund their down payments?

According to the National Association of Realtors:

• 59% of first-time homebuyers relied on personal savings
• 26% tapped into financial assets such as 401Ks, IRAs or stocks, and
• 22% got help from family or friends (both gifts and loans)

For repeat buyers, 54% used proceeds from the sale of a previous home to finance their next purchase.

Important: Don't forget that various DPA (down payment assistance) programs are available!

How can buyers save for a down payment?

The most important thing is to have a plan: figure out how much home you can prudently afford, determine what down payment is required, and develop a monthly savings plan that gets you there within the right time frame.

Ultimately, it's about earning more and spending less. With proper budgeting and financial discipline, even a few $100 a month builds up quickly.

Here are a few additional thoughts on saving for a down payment:

• Be prudent: Your first home doesn't need 5 bedrooms and a 3-car garage. A more modestly-priced first home means a lower down payment.
• Prioritize: What's more important, getting into your own home or buying a new truck? The $5K you might drop on a trip to Hawaii could be a decent chunk of your down payment.
• Pay down high cost debts (like credit cards) first. It's hard to save for a down payment with $10K in credit card debt accruing interest at 25% APR.
• Set up an automatic savings plan (where a portion of your monthly salary goes straight into a down payment account that you won't touch.)
• Don't be afraid to ask family and friends for assistance: Parents are increasingly helping their children with down payments and even wedding registries are adding 'help us buy a house' to the gift list!

The Home Report helps you develop your own savings plan.