Many first-time homebuyers are willing to make notable sacrifices to come up with a down payment — something that's becoming increasingly difficult to do.
Nearly 60 percent of couples are willing to skip their honeymoon, according to a recent ERA Real Estate survey of 1,000 people. And nearly 50 percent of the female respondents said they'd give up a big engagement ring,
MarketWatch reports.
According to real estate professionals, the willingness to sacrifice isn't just idle talk. People are cutting back on seemingly minor expenses such as morning coffee stops and going out to lunch. But they are also making bigger sacrifices such as downsizing their wedding festivities and selling their items, such as cars and sporting equipment.
Editor's Note: Seniors Scoop Up Unclaimed $20,500 Checks? (See if You qualify)
Approximately 15 percent of the time, buyers take a loan from their 401(k), and they're often first-time buyers, Cyndee Kendall, vice president of the Northern California region for Bank of the West, tells MarketWatch.
"For years, first-time buyers were in their late 20s and early 30s, and they put as much down as they could to qualify and keep their payments low," says Julie Reynolds, a spokeswoman with LoanDepot.
"But LoanDepot is seeing their average age inch up and their down payments shrink. A lot of people want to put 10 percent down, but can't," she tells MarketWatch.
Younger Americans are also struggling to get into the housing market.
In addition to their hefty student loans and the weak job market, young people also don't have enough money for a down payment and they're often unable to get approved for loans due to tighter lending standards, notes
Investor's Business Daily.
But many millennials draw the line when it comes to sacrificing small luxuries, a Trulia survey reveals.
Asked about the items they'd never give up to save for a down payment, 65 percent said their car, 45 percent said their smartphone, 20 percent said their cable, 15 percent said their Netflix subscription, 14 percent said their vacations and 13 percent said dining out, MarketWatch notes.
Millennials tend to lean toward different strategies, the survey reveals. For instance, 37 percent plan to work a second job, and half said they'd ask their parents or grandparents for help in coming up with a down payment, according to MarketWatch.
The struggles Americans are facing in coming up with down payments is a cause for concern, say industry observers. First-time homebuyers are integral part of the real estate cycle; they basically pave the way for current homeowners to upgrade.
"The importance of first-time buyers is that they start a chain reaction. They get in the market and help other buyers sell their homes," Lawrence Yun, chief economist at the National Association of Realtors, tells Investor's Business Daily.
Editor's Note: Seniors Scoop Up Unclaimed $20,500 Checks? (See if You qualify)
© 2025 Newsmax Finance. All rights reserved.