How to Save for Down Payment on a Home

Oviedo real estate, Orlando luxury homes

Rent rates are continuing climb as are home values. If you’ve been dreaming of moving out of your rental and into a home that you can call your own, now may be the best time to think about saving for a down payment on a home, like Oviedo real estate.

The standard amount most people put down is 20% in cash and the rest of the home’s cost is taken out as part of a mortgage.

If you don’t put down 20%, the monthly mortgage rate will be higher and you may also have to pay for mortgage insurance on your pick of homes for sale in Oviedo.  This will make the home you are trying to buy that much more expensive in the end.

The best way to start moving in the direction of home ownership is to focus on a dollar amount. How much can you really afford? The average 20% down payment in the United States equals approximately $36,500, according to Zillow. This number can vary greatly, depending on where the home is and the type of home you are looking to buy.  For example, the median cost on homes for sale in Oviedo will be different than Orlando luxury homes.

How Much is a 20% Down Payment

Forbes put together a list of some of the top cities and how much you can expect to put down based on the median home in each of the following metro areas:

  • San Francisco, CA: $153,600
  • Boston, MA: $76,220
  • New York, Northern New Jersey: $75,800
  • Seattle, WA: $71,880
  • Washington, DC: 71,060
  • Denver, CO: $62,760
  • Baltimore, MD: 47,840
  • Miami, Fort Lauderdale, FL: $44,680
  • Phoenix, AZ: 42,060
  • Chicago, IL: 38,200

How to Start Saving

To get started saving up for a down payment, follow through the following 4 tips and you’ll have that 20% ready to go before you know it!

  1. Prioritize: Make saving for your new Oviedo real estate property or another home top priority and cut back in areas where you spend without even realizing it. This could be such as eating out, buying the latest gadgets, going to the movies, buying clothes, expensive vacations, etc. Try to live more economically so that you can get the big reward at the end.
  2. Clear Debt: If you are paying a lot of interest on past purchases – stop. Saving money means you’ve got to clear your debt. Pay these debtors first. Not only will it allow you to really start saving, it will look great on your credit score.
  3. Downsize: Do you really need two cars? Get rid of one car and save yourself thousands of dollars every year. There’s a reason walkability has become the new buzzword for home buyers. When you start looking for a home, be sure to find one close to your job or public transportation to assist with commuting.
  4. Pocket the Extras: Bonus check, dividend check, tax refund, extra sales commissions, birthday money, and other financial gifts should be placed in an interest earning savings account. Do it as quick as it comes in so you aren’t tempted at using any of it. You’ll be glad you did!
Florida Realty News
Florida Realty News
Berkshire Hathaway HomeServices Florida Realty, a wholly-owned subsidiary of WCI Communities, has over 39 locations and more than 1,650 real estate sales professionals and team members serving 17 counties throughout Florida.
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