Homebuyers are making substantially smaller down payments than they once did, Washington Post columnist Kenneth Harney notes. The median down payment for first-time purchasers was a mere 2 percent, and nearly half got loans with no money down, according to research by the National Association of Realtors from mid-2005 to mid-2006. (Repeat home buyers, who often used the proceeds of prior home sales, typically invested 16 percent). There are several reasons down payments are shrinking, Harney writes: home prices have shot up relative to buyers’ savings, and mortgage lenders and insurers have begun offering a rash of low down-payment options.
Yo wants to know: have you spotted this trend in the Chicago or suburban markets?