U.S. homebuyers are relying less on family members and other loved ones for assistance in paying down payments despite a rise in home prices. A recent study by the National Association of Realtors (NAR) showed that down payment gifts from family members and friends during the home-buying process in 2023 in the US stood at 23%; the second-lowest level over the past 23 years.
With prices and mortgage rates continuing to simmer, experts explain that the current market is composed of high-income buyers who are financially self-sufficient. “Just among all buyers, they tend to be wealthier. We’re seeing that especially in the current market, [buyers] might need to have that extra income just to be able to get into the homeownership market,” Brandi Snowden, the NAR’s director of member and consumer survey research explained.
Data from Realtor.com indicated that the percentage share of down payment to home price rose to 14.71% in the third quarter of 2023; the highest level in the past 10 years.