Report: Down payments stopping San Diegans from owning a home

Posted at 12:28 PM, Apr 11, 2017
and last updated 2017-04-11 15:28:07-04

SAN DIEGO (KGTV) - Homeownership is already a struggle in San Diego, and down payments are not helping.

The primary barrier preventing San Diegan renters from buying a home in the down payment needed, according to Zillow's Housing Aspirations Report.

The survey found nearly 73 percent of San Diegan renters attributed down payments as the top barrier preventing them from buying a house. Fifty-four percent said debt was a roadblock, and a little more than half said qualifying for a mortgage was an obstacle.

"Rising rents are also a factor - it’s extremely difficult to save when you’re paying record-high rents. While it is possible to put down as little as three percent on a home, the trade-off is a higher interest rate and costly private mortgage insurance, a financial tradeoff that may make sense for some buyers,"  Svenja Gudell, Zillow's chief economist, said. "For those trying to save for a down payment, it’s important to set realistic goals and realize it may take a few years."

Nationally, almost 70 percent of renters said down payments were preventing them from buying a home. San Diego, San Jose, and Los Angeles had the greatest share of renters who share this problem.

Around the country, renters felt debt, job security, and qualifying for a mortgage were also the top barriers, in that order.

It all makes sense, according to the study. Homeownership is near an all-time low, though the next generation of renters is starting to consider taking the next step.

Millennials, however, seem to be optimistic about their chances of owning a home. Thirty-four percent said the plan on buying a home in three to five years. About 22 percent said they plan to own a home in one or two years, according to Zillow's survey.

Two percent said they never plan on owning a home.

Ten-thousand renters from 20 different metropolitan areas were surveyed for Zillow's report.