Here’s how long a renter needs to save to buy a home

by Steve Randall01 Mar 2019

Renters hoping to buy a home can expect to be saving for a down payment for 8 years on average; although it can take more than 4 times longer!

An analysis by HotPads calculates that as the time a renter would take to save $45,000 as a 20% down payment on the US median priced home ($223,300). It assumes they save 16.5% of their income after accounting for the cost of renting (the typical savings rate for renters in the US according to the 2017 Bureau of Labor Statistics Consumer Expenditure Survey.)

However, renters could save their down payment almost three years faster if they were able to live rent free – for example with mom and dad – if they used the typical 34% renters use for housing costs, as additional savings.

"Coming up with a down payment is often the biggest hurdle for first-time home buyers. The challenge has become all the more difficult because of rising rents and home values, which make savings harder and the necessary down payment bigger," said Joshua Clark, economist at HotPads. "While living independently may be appealing, for many it's not worth the prospect of pushing home ownership further into the future. Living rent-free with family is an increasingly common way young adults can accumulate the pot of savings necessary to purchase their first home."

42 years to buy a home

Of course, in the hottest markets, those earning the median income would take significantly longer to save a 20% down payment for a typical home.

In San Jose it would take renters more than 42 years to save – meaning they would be preparing to retire before becoming homebuyers – but they could cut that to just above 18 years if they were able to eliminate the cost of renting.


10% Down Paymentv

20% Down Paymentvi

Metro Area

Median
Rent

Median
Home
Valuevii

Median
Annual
Incomeviii

10%
Down
Payment

Time
Spent
Saving

Time

Spent
Saving
Without
Housing
Costs

20%
Down
Payment

Time
Spent
Saving

Time
Spent
Saving
Without
Housing
Costs

United States

$1,525

$225,300

$52,449

$22,530

4 yr. 0 mo.

2 yr. 7 mo.

$45,060

8 yr. 0 mo.

5 yr. 2 mo.

New York, NY

$2,375

$438,300

$65,142

$43,830

7 yr. 3 mo.

4 yr. 1 mo.

$87,660

14 yr. 6 mo.

8 yr. 2 mo.

Los Angeles-
Long Beach-
Anaheim, CA

$2,940

$652,300

$58,055

$65,230

17 yr. 4 mo.

6 yr. 10 mo.

$130,460

34 yr. 9 mo.

13 yr. 7 mo.

Chicago, IL

$1,785

$224,800

$56,117

$22,480

3 yr. 11 mo.

2 yr. 5 mo.

$44,960

7 yr. 10 mo.

4 yr. 10 mo.

Dallas-Fort
Worth, TX

$1,675

$242,600

$53,102

$24,260

4 yr. 5 mo.

2 yr. 9 mo.

$48,520

8 yr. 11 mo.

5 yr. 6 mo.

Philadelphia,
PA

$1,680

$232,700

$56,926

$23,270

3 yr. 10 mo.

2 yr. 6 mo.

$46,540

7 yr. 8 mo.

4 yr. 11 mo.

Houston, TX

$1,585

$205,500

$55,765

$20,550

3 yr. 5 mo.

2 yr. 3 mo.

$41,100

6 yr. 9 mo.

4 yr. 6 mo.

Washington,
DC

$2,180

$406,200

$71,711

$40,620

5 yr. 5 mo.

3 yr. 5 mo.

$81,240

10 yr. 10 mo.

6 yr. 10 mo.

Miami-Fort
Lauderdale,
FL

$2,035

$283,800

$48,554

$28,380

7 yr. 2 mo.

3 yr. 7 mo.

$56,760

14 yr. 3 mo.

7 yr. 1 mo.

Atlanta, GA

$1,480

$217,500

$53,247

$21,750

3 yr. 9 mo.

2 yr. 6 mo.

$43,500

7 yr. 5 mo.

4 yr. 11 mo.

Boston, MA

$2,415

$467,000

$67,784

$46,700

7 yr. 4 mo.

4 yr. 2 mo.

$93,400

14 yr. 7 mo.

8 yr. 4 mo.

San
Francisco, CA

$3,510

$957,400

$72,219

$95,740

19 yr. 3 mo.

8 yr. 0 mo.

$191,480

38 yr. 7 mo.

16 yr. 1 mo.

Detroit, MI

$1,305

$160,000

$53,983

$16,000

2 yr. 6 mo.

1 yr. 10 mo.

$32,000

5 yr. 1 mo.

3 yr. 8 mo.

Riverside, CA

$1,975

$367,100

$49,061

$36,710

8 yr. 9 mo.

4 yr. 6 mo.

$73,420

17 yr. 7 mo.

9 yr. 1 mo.

Seattle, WA

$2,240

$489,700

$65,401

$48,970

7 yr. 8 mo.

4 yr. 6 mo.

$97,940

15 yr. 5 mo.

9 yr. 1 mo.

Minneapolis-
St Paul, MN

$1,690

$268,100

$58,055

$26,810

4 yr. 4 mo.

2 yr. 10 mo.

$53,620

8 yr. 7 mo.

5 yr. 7 mo.

San Diego, CA

$2,730

$591,400

$58,449

$59,140

13 yr. 11 mo.

6 yr. 2 mo.

$118,280

27 yr. 11 mo.

12 yr. 3 mo.

St. Louis, MO

$1,200

$167,000

$50,957

$16,700

2 yr. 9 mo.

2 yr. 0 mo.

$33,400

5 yr. 6 mo.

4 yr. 0 mo.

Tampa, FL

$1,485

$213,600

$47,745

$21,360

4 yr. 4 mo.

2 yr. 9 mo.

$42,720

8 yr. 8 mo.

5 yr. 5 mo.

Baltimore,
MD

$1,750

$267,900

$58,438

$26,790

4 yr. 4 mo.

2 yr. 9 mo.

$53,580

8 yr. 8 mo.

5 yr. 7 mo.

Denver, CO

$2,120

$405,300

$59,474

$40,530

7 yr. 3 mo.

4 yr. 2 mo.

$81,060

14 yr. 5 mo.

8 yr. 3 mo.

Pittsburgh,
PA

$1,110

$143,900

$50,336

$14,390

2 yr. 4 mo.

1 yr. 9 mo.

$28,780

4 yr. 9 mo.

3 yr. 6 mo.

Portland, OR

$1,950

$397,300

$57,330

$39,730

7 yr. 1 mo.

4 yr. 2 mo.

$79,460

14 yr. 2 mo.

8 yr. 5 mo.

Charlotte, NC

$1,395

$206,200

$51,962

$20,620

3 yr. 7 mo.

2 yr. 5 mo.

$41,240

7 yr. 1 mo.

4 yr. 10 mo.

Sacramento,
CA

$1,985

$408,700

$56,998

$40,870

7 yr. 6 mo.

4 yr. 4 mo.

$81,740

14 yr. 11 mo.

8 yr. 8 mo.

San Antonio,
TX

$1,390

$192,800

$47,870

$19,280

3 yr. 9 mo.

2 yr. 5 mo.

$38,560

7 yr. 6 mo.

4 yr. 11 mo.

Orlando, FL

$1,535

$237,100

$46,015

$23,710

5 yr. 2 mo.

3 yr. 1 mo.

$47,420

10 yr. 5 mo.

6 yr. 3 mo.

Cincinnati,
OH

$1,250

$168,900

$50,657

$16,890

2 yr. 10 mo.

2 yr. 0 mo.

$33,780

5 yr. 1 mo.

4 yr. 0 mo.

Cleveland,
OH

$1,210

$145,600

$50,688

$14,560

2 yr. 5 mo.

1 yr. 9 mo.

$29,120

4 yr. 11 mo.

3 yr. 6 mo.

Kansas City,
MO

$1,260

$191,600

$51,247

$19,160

3 yr. 3 mo.

2 yr. 3 mo.

$38,320

6 yr. 5 mo.

4 yr. 6 mo.

Columbus,
OH

$1,440

$189,900

$51,828

$18,990

3 yr. 4 mo.

2 yr. 3 mo.

$37,980

6 yr. 8 mo.

4 yr. 5 mo.

Indianapolis,
IN

$1,240

$163,900

$49,766

$16,390

2 yr. 10 mo.

2 yr. 0 mo.

$32,780

5 yr. 8 mo.

4 yr. 0 mo.

San Jose, CA

$3,710

$1,245,800

$79,969

$124,580

21 yr. 4 mo.

9 yr. 5 mo.

$249,160

42 yr. 7 mo.

18 yr. 11 mo.

Austin, TX

$1,755

$308,200

$53,713

$30,820

5 yr. 9 mo.

3 yr. 6 mo.

$61,640

11 yr. 5 mo.

6 yr. 11 mo.

Virginia
Beach, VA

$1,485

$229,400

$49,123

$22,940

4 yr. 5 mo.

2 yr. 10 mo.

$45,880

8 yr. 11 mo.

5 yr. 8 mo.

Nashville, TN

$1,515

$253,500

$48,813

$25,350

5 yr. 0 mo.

3 yr. 2 mo.

$50,700

10 yr. 0 mo.

6 yr. 4 mo.

Providence,
RI

$1,780

$293,200

$54,107

$29,320

5 yr. 5 mo.

3 yr. 3 mo.

$58,640

10 yr. 10 mo.

6 yr. 7 mo.

Milwaukee,
WI

$1,385

$229,200

$51,880

$22,920

3 yr. 11 mo.

2 yr. 8 mo.

$45,840

7 yr. 11 mo.

5 yr. 4 mo.

Jacksonville,
FL

$1,400

$212,100

$47,414

$21,210

4 yr. 2 mo.

2 yr. 9 mo.

$42,420

8 yr. 5 mo.

5 yr. 5 mo.

Memphis, TN

$1,050

$139,100

$45,538

$13,910

2 yr. 7 mo.

1 yr. 10 mo.

$27,820

5 yr. 1 mo.

3 yr. 8 mo.

Oklahoma
City, OK

$1,120

$146,400

$47,735

$14,640

2 yr. 7 mo.

1 yr. 10 mo.

$29,280

5 yr. 2 mo.

3 yr. 9 mo.

Louisville-
Jefferson
County, KY

$1,145

$161,200

$46,730

$16,120

3 yr. 0 mo.

2 yr. 1 mo.

$32,240

5 yr. 11 mo.

4 yr. 2 mo.

Hartford, CT

$1,700

$229,100

$62,210

$22,910

3 yr. 4 mo.

2 yr. 3 mo.

$45,820

6 yr. 8 mo.

4 yr. 6 mo.

Richmond,
VA

$1,465

$228,100

$51,641

$22,810

4 yr. 1 mo.

2 yr. 8 mo.

$45,620

8 yr. 1 mo.

5 yr. 4 mo.

New Orleans,
LA

$1,450

$174,600

$44,875

$17,460

3 yr. 10 mo.

2 yr. 4 mo.

$34,920

7 yr. 8 mo.

4 yr. 9 mo.

Buffalo, NY

$1,280

$158,100

$49,921

$15,810

2 yr. 9 mo.

1 yr. 11 mo.

$31,620

5 yr. 7 mo.

3 yr. 10 mo.

Raleigh, NC

$1,480

$264,800

$53,247

$26,480

4 yr. 6 mo.

3 yr. 0 mo.

$52,960

9 yr. 1 mo.

6 yr. 0 mo.

Birmingham,
AL

$1,050

$144,600

$49,009

$14,460

2 yr. 5 mo.

1 yr. 9 mo.

$28,920

4 yr. 10 mo.

3 yr. 7 mo.

Salt Lake City,
UT

$1,615

$360,600

$51,403

$36,060

6 yr. 10 mo.

4 yr. 3 mo.

$72,120

13 yr. 8 mo.

8 yr. 6 mo.

 


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