The home sales slump in the U.S. continues: Last month was the slowest May for existing home sales since 2009.
Existing home sales in May fell 0.7% compared to the same month last year. Measured monthly, sales were up slightly, 0.8%, from the month before — but that marks an increase from the slowest April for existing home sales in 16 years.
It has more to do with interest rates and home prices than down payment though you aren’t wrong about that being a burden. A $200k house on a 5% down fha loan requires about $10k in down payment and another $10k mortgage costs. Then when it used to be about 3% interest rates, that would cost you about $1000/month in P&I plus insurance and taxes.
That world is gone though. A basic house in the houston metroplex now goes for $300k at 7% interest so while the down payment has only gone up $5k the rest of it has gone up ~100% meaning a basic house is now a $2000/month expense.
That is napkin math but if you do the numbers for real it is probably pretty close.