Where down payments are the lowest...and highest

Homebuyers in areas with the lowest costs are making half the down payments as those in more expensive areas, according to new data from RealtyTrac.

In 25 counties with the lowest median home prices, the typical money put toward purchase added up to 12 percent of the price, or $8,239. Conversely, the counties that had the highest median prices saw down payments average 24 percent, or $138,547. ( Tweet This )

In a statement accompanying the release, RealtyTrac cited comments from industry professionals touting the benefits of affordability through lower down payments. However, the lack of "skin in the game," as it sometimes is called, was cited as one of the reasons for the housing collapse that began 10 years ago. Buyers at the lower end of credit standards often were able to purchase homes with little or no money down at teaser rates that spiked within a few years.

"After the Great Recession, the public is becoming more aware of the available lending opportunities in the market today. The pendulum has swung back to a strong lending environment," said Mike Pappas, CEO and president of the Keyes Company, a principal in the South Florida market, according to RealtyTrac. "Home affordability is still near an all-time high in our market—which makes it still a great buying opportunity."

Millennials, or those who reached adulthood around the turn of the century, are taking advantage of the low down payment opportunities, flocking to areas such as Montgomery County, Tennessee, where the average down payment is just 11 percent and which saw a 46 percent increase in millennials between 2007 and 2013.

Millennials on the move for mortgages

County
Millennial gain, 2007-13
Avg. down payment
Montgomery, Tenn. 46% 11%
Davidson, Tenn. 37% 13%
Dunham, N.C. 28% 13%
Philadelphia, Pa. 25% 13%
Polk, Iowa 23% 12%
Prince William, Va. 22% 11%
Franklin, Ohio 22% 13%
Cumberland, N.C. 21% 9%
Pulaska, Ark. 21% 12%
Columbia, Ga. 20% 12%
Source: RealtyTrac

RealtyTrac released an interactive map—get it here—that shows the percentage of homebuyers with 3 percent or less down, the median home price and the average down payment percentage.

Luzerne County, Pennsylvania, for instance, had 28.68 percent of loans with 3 percent or less in down payments to go with a median home price of $74,900 and an average down payment percentage of 11.18, or $8,373.82.

By contrast, Marin County, California, had only 1.7 percent of loans in the 3 percent or less category, with a median home price of $864,500 and an average down payment of 27.81 percent, or $240,417.45.

Overall, low or no down payment loans hit their lowest level in at least a decade in 2014, accounting for 25 percent of the total, down from a record 46 percent in 2009 and from 27 percent in 2013, according to RealtyTrac.

Executives quoted by the firm said programs that help out first-time buyers with down payments are being extended even to higher-end buyers.

"Programs in high-cost markets may offer even greater down payment help, and income and home price limits are typically increased to fit the market," said Rob Chrane, president and CEO of Down Payment Resource. "There's a general lack of awareness among first-time homebuyers about down payment programs which may be keeping more of them on the sidelines longer than necessary."