What's Happening?
According to Realtor.com, the time required for Americans to save for a median down payment on a house decreased to seven years in 2025, down from a peak of 12 years in 2022. Despite this improvement, the current savings time is still nearly double the pre-pandemic
level. The increase in down payment time is attributed to rising home prices and a slower savings rate. Home prices have surged by 55% from September 2019 to September 2025, significantly increasing the typical down payment from $13,900 to $30,400. The U.S. personal savings rate also fell to 5.1% in 2025, below the pre-pandemic rate of 6.5%.
Why It's Important?
The extended time to save for a down payment impacts potential homeowners, delaying their entry into the housing market and exposing them to rising rents. This delay can hinder access to home equity, a key component of long-term wealth building in the U.S. The broader economic implications include slowed housing demand, reduced construction, and decreased mortgage activity, which can affect consumer spending related to home purchases and improvements. The disparity in savings time across different markets, such as high-cost areas like San Francisco, further exacerbates these challenges.
