On St. Croix, we are generally seeing homebuyers putting less money down now compared to 2 years ago, similar to what is happening in other US markets. According to a report from Redfin in March 2023 that looked at 40 of the most populous metropolitan areas in the US, and records indicating homebuyers who took out a mortgage, the typical down payment of a US homebuyer has fallen 10% from a year ago for the purchase price of the house. The median down payment is now 10% of the purchase price of the house, off its peak of 17.5%, (which amounted to $65,000), in May 2022. You can find the full report on Redfin and a good summary in this Axios article.
With elevated mortgage rates compared to years past, and home prices staying steady, buyers are facing higher monthly mortgage payments, and therefore more constrained in what they can afford to put down, as pointed out in the Axios article. On St. Croix, we are also seeing some earnest money deposits less than 10% for some higher price properties.
What does this mean for homebuyers? Whether you are searching for a modest home or financing a premiere property, it’s still possible to get your offer accepted with a smaller down payment compared to one or two years ago.
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