Report: Rent Savings Mean Down Payment Options

There may be an upside for the young adults who were forced to move back home with their parents during the pandemic: Homeownership may be within reach sooner than they think.

A new report released Thursday by realtor.com found that saving the one-bedroom median rent of $1,533 means that it would take 11 months to save $17,000 – enough for a 5 percent down payment on a $340,000 home, the median-priced home in the United States.

“Although many members of the millennial and Gen Z generations were forced to move home because they lost their jobs in 2020, others chose to forgo their rental because they had the opportunity to work remotely and preferred to wait out the pandemic with family,” realtor.com Chief Economist Danielle Hale said. “For those who have been able to channel their would-be rent into savings, the pandemic’s silver lining could be becoming a homeowner sooner than they otherwise would have.”

The report found it would take an average of 15 months to save for a 5 percent down payment in the 20 largest metropolitan areas – with the fastest in Chicago and Philadelphia and longest in California (Los Angeles, San Francisco and San Diego).

Here is a look at savings times by metropolitan area: