Here’s Where You Can Save For a Down Payment Fastest

Renters in Dayton could save 10% for a down payment on a starter home in just 21 months by downsizing their current rental by one bedroom, according to a recent RentCafe survey.

The firm analyzed 200 cities to determine where renters can save for a down payment by the fastest merely by downsizing by a bedroom and found that renters could save an average of $3,735 per year with the strategy. Dayton was followed by Philadelphia (savings of 10% for a down payment in 1 year and 10 months) and Jackson, Miss. (2 years).  Chicago comes in fourth (2 years and 3 months to reach the goal) while giving up a bedroom in New York saves renters more than $20,000 per year.

The median starter home price in Dayton clocks in at $57,652, with a down payment value of $5,765.

“The sixth-largest city in Ohio makes it easy for renters to fulfill their homeownership goals due to a low starter home price, which accounts for an affordable down payment value of only $5,765,” RentCafe’s Laura Pop-Badiu writes. “Dayton is also one of the places with the most apartment space per person, which makes downsizing less challenging here than it would be in other cities. Pair that with a dense suburban feel and an affordable cost of living, and it’s safe to say that owning a home in Dayton can literally be a dream come true for many.”

One in three renters surveyed by the firm say they are willing to sacrifice space while renting to inch closer to homeownership. Median home prices surged 7% in the first quarter, a 38% increase over the same period in 2020, and according to Moody’s Analytics, the lowest tier of the housing market appreciated by 17.2% in the past year alone.

Two years ago households had to earn $73,400 to qualify for a mortgage on a median priced home, which just 45% of US households could muster.  But by April of this year, buyers needed more than $113,000 in income to qualify for the same home, and only 26% of households could qualify.