Realtor.com recently published an article detailing the savings needed to buy a home in the 11 largest metropolitan areas in America. Cities like New York, Los Angeles, Dallas, Philadelphia, and San Francisco made the list.
The author’s then tabulated the average down payment for that metropolitan area. Then they broke down the down payment into a daily savings goal over both a 5-year and a 10-year period.
Not entirely surprisingly, San Francisco’s median home price was the highest at $954,000. The average down payment was $171,836.
A San Francisco home buyer would need to save approximately $94 per day to save up this amount in 5 years or $47 per day to save up in 10 years. Converting this to Starbucks lattes resulted in cutting out 26 lattes per day to save up enough for a down payment in a 5 year period.
Buying a Home in Dana Estates
Let’s do an analysis for single-family detached homes in the Dana Estates neighborhood in Concord.
In the past 6 months about 22 single family homes in the Dana Estates neighborhood have sold as of 8/19/2019. That isn’t counting homes currently on the market or in pending status.
The median listing price for homes was $622,000, with a median sale price of $634,000. Using 15% as an assumed down payment, a buyer would need to save $95,100.
Five Year Savings Plan
To save $95,100 for a down payment in Dana Estates in five years would require saving $52.08 per day. Simply cutting out 14 Grande Lattes per day at Starbucks.
Ten Year Savings Plan
To save the $95,100 in 10 years would require, a more manageable, $26.04 per day. Thus only cutting 7 Grande Lattes out of your diet. (Note: Your waist and your heart will thank you for this sacrifice.)
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Buying a Home in Concord, CA
If we include condos, townhouses, duets, and other single-family homes to our analysis, what will a home buyer have to save in Concord, CA?
In the six months prior to August 19, 2019 there were 940 sales of single-family homes in Concord. The median sales price was $595,000. Assuming a 15% down payment, allows for a down payment of $89,250.
Concord Five Year Savings Plan
To save $89,250 for a down payment in Concord would require a daily savings goal of $48.80 for five years. On our Grande Latte scale that equates to 13.4 lattes per day removed from your diet.
Concord Ten Year Savings Plan
Over ten years the daily savings goal is decreased to $24.44 per day. The coffee habit would need to decrease by almost 6.7 lattes per day.
How to Save for a Down Payment?
While cutting out 14 lattes per day may not be possible, there are some unique loan programs that allow a buyer to purchase a home with a down payment of only 3.5% of the purchase price (FHA). A down payment of 3.5% equals $21,770 on the average Dana Estates home.
Peter Maclennan will gladly connect you with one of his recommended lenders to understand payment options and getting a mortgage.
Having a knowledgeable and experienced real estate broker on your side helps protect your interests and ensure you make the best possible decisions. We are dedicated to keeping on top of the real estate market and keeping you informed of changes. You can rest easily knowing you made a well-informed decision based on experience and insight into the Concord California market.