60+ Surprising Mortgage Facts and Home Buyer Statistics in 2022
Homebuyer was created with a mission to make homeownership more accessible and inclusive for every American. We strive to strengthen neighborhoods through a simple, fast, and better homebuying experience.
Mortgage rates, home prices, and the housing market as a whole are always fluctuating. For first-time buyers, it can be time-intensive to get all of the information needed and feel ready to start the home-buying process.
These mortgage facts and home buyer statistics will help you learn about home-buying and avoid first-time buyer mistakes.
- Average monthly mortgage cost: $1,297
- Median monthly mortgage payment: $975
- Percent of U.S. adults that are homeowners: 65%
- Current U.S. mortgage debt: $10.04 trillion
- 2021 first-time home buyers: 31% of buyers
- Average credit score: Conventional (756), FHA (676), VA (720)
- In 2020, there were 2.38 million first-time home buyers. The most in history.
- A 15-year fixed-rate mortgage (FRM) offers a 25% lower interest rate than a 30-year FRM (September 24, 2021).
- 62% of Americans believe a 20% down payment is necessary, though most mortgage loans require less than 5% down payment.
- 13.4 million Americans were approved for a single-family mortgage in 2020 (a 112.6 percent increase from 2018).
- First-time home buyers make a median down payment of 7% on their home. Repeat home buyers make a median down payment of 16%.
Mortgage and Home-Buying Statistics
Home Loan Facts
There are a number of different mortgages available for home buyers depending on the loan type or property you’re interested in, your financial health, and your location. Mortgages are large loans with a significant amount of money changing hands, so there’s a lot to know.
Here are some mortgage facts to familiarize yourself with home loans:
- Monthly mortgage costs averaged $1,297 in 2019 with a median payment of $975. (Census AHS, 2020)
- As of September 24, 2021, a 15-year fixed-rate mortgage (FRM) offers a 25 percent lower interest rate than a 30-year FRM. A 30-year FRM is 2.88 percent, vs. the 15-year mortgage’s 2.15 percent. (Freddie Mac, 2021)
"Between January 1992 and December 2020, the average difference between 30-year fixed rate mortgage rates and 15-year fixed-rate mortgage rates was 0.546 percentage points." (Freddie Mac, 2021)
- About 20.3 million Americans applied for single-family closed-end mortgages in 2020 (100.9 percent increase from 2018) and 13.4 million were approved (112.6 percent increase). (CFPB, 2020)
- The biggest interest rate spread between conventional 30-year and 15-year mortgage rates in recorded history was 0.88 percent in 2014 (3.29 percent vs. 4.17 percent). The smallest recorded spread was 0.31 percent in 2007 (6.03 percent vs. 6.34 percent). (ValuePenguin, 2021)
- 38 percent of owner-occupied homes are owned free-and-clear. (Construction Coverage, 2020)
- Conforming loan limits for 2021 increased to $548,250 from $510,400 in 2020 — a 7 percent increase. This reflects the average home price increase of 7.42 percent between 2019 and 2020. (FHFA, 2020)
- 75 percent of Americans believe it’s more difficult to afford a home purchase now than it was 25 years ago. (NerdWallet, 2020)
"Over the last 25 years, while mortgage rates halved, home prices tripled. Homeowners pay less to live in their home each month, but they pay to make a down payment.
The good news is: you’re allowed to make a small down payment. The typical first-time home buyer makes a down payment of 7%."
- The median down payment for first-time home buyers is 7 percent of the purchase price, or $7,000 for every $100,000 purchased. You don’t need a 20 percent down payment to purchase a home. (NAR, 2020)
- The median home purchase price was $272,500 in 2020. Homes were typically purchased at 99 percent of the asking price. (NAR, 2020)
- 87 percent of home buyers financed their recent home purchase with a mortgage. (NAR, 2020)
- 58 percent of buyers used at least some of their personal savings to pay for their down payment (NAR, 2020)
- The largest weekly increase in interest rates was during the Taper Tantrum where rates jumped 0.53 percentage points between June 20-27, 2013. (Freddie Mac, 2021)
- The largest weekly decrease in interest rates was 0.22 percentage points between March 21-28, 2019. (Freddie Mac, 2021)
- In a 3-month period, the most 30-year mortgage rates have increased was from January to April 1980, when they spiked from 12.85 percent to 16.35 percent. (Freddie Mac, 2021)
- 15 percent of home buyers found understanding the home-buying process to be the hardest home-buying step (third hardest overall), while 7 percent of home buyers said securing a mortgage was the hardest home-buying step (fifth hardest overall). (NAR, 2021)
- In 2020, GSE mortgage investors, such as Freddie Mac and Fannie Mae, originated 59.2 percent of total market volume. Portfolio originations, which include jumbo loans, accounted for 21.5 percent of the market volume, followed by FHA and VA investors at 18.4 percent, and private lenders at 0.9 percent. (Housing Finance Policy Center, 2021)
15- and 30-Year Mortgage Rate Averages
|Year||Mortgage Rate||Estimated Monthly Payment*||Mortgage Rate||Estimated Monthly Payment*|
|*Estimated monthly mortgage payment is based on median new home construction sale price data from the U.S. Census Bureau.|
First-time home buyer mortgage facts
- The average first-time home buyer is 34 years old. (Experian, 2020)
- 31 percent of buyers in 2021 were first-time home buyers. (NAR, 2020)
- First-time home buyers typically finance 93 percent of their home, while repeat buyers finance 84 percent. (NAR, 2020)
"In 2020, there were 2.38 million first-time home buyers. The most in history."
- 82 percent of young Americans ages 22-30 are first-time home buyers. 48 percent of Millennials aged 32-40 are also first-time buyers. (NAR, 2021)
- 31 percent of 2021 buyers are first-time homeowners, despite the fact that starter home prices have increased 86 percent while incomes for young Americans have increased 24 percent since 2012. (NAR, 2021)
Mortgage fun facts
- “Mortgage” is a French term that indirectly translates to “death pledge.” The intention was to show that the pledge dies when the debt is fully paid. (Online Etymology Dictionary)
- Painting your door red when you’ve paid your mortgage in full is a Scottish tradition to celebrate the pride of paying off your debt. (Sina Architectural Design)
- Some U.S. homeowners place a winged bald eagle above their door as a symbol of freedom from mortgage payments. (Fannie Mae)
Buying your first home is an exciting milestone that provides new experiences, opportunities, and lessons in life. Check out these facts about home-buying for a better expectation of the process.
- The number one reason people cited for wanting to purchase a property was “the desire to own a home of my own.” (NAR, 2020)
- 88 percent of 2020 home buyers purchased their home using the help of a real estate agent or broker. (NAR, 2020)
- Home sales have increased over the last two years. 2020 saw a 20 percent increase in home sales from 2019, while 2021 indicates an additional 7 percent increase year-to-date. (Census, July 2021)
“When you're a first-time home buyer, it always feels like sellers are in control because sellers stay less emotional. They know if you don’t buy the home, somebody else will.”
- 84 percent of Americans say homeownership is a priority. (Nerdwallet, 2020)
- There were fewer than 26,000 homes for sale on average per state in August 2021 (NAR, 2021)
- 97 percent of home buyers use the internet to search for homes. (NAR, 2020)
- The U.S. homeownership rate was 65.4 percent in the second quarter of 2021. (Census, 2021)
Home-buying location statistics
- 4 percent of home buyers move more than 50 miles for their new purchase. (Redfin, 2021)
- 25 percent of Americans who have worked remotely say they bought or will buy a home in a different location because of remote work flexibility. (NerdWallet, 2021)
- 53 percent of buyers say finding the right property is the most challenging part of buying a home. (NAR, 2021)
- Iowa and many Midwestern states are the most affordable states to buy a house, while Hawaii and California are the most expensive states for home buyers. (Homebuyer)
- Florida offers the largest inventory of homes for sale, including Miami, Orlando, and Jacksonville metro areas. (Inspection Support Network)
- Based on the number of monthly residential listings per 10,000 homes, Florida and Hawaii have the most homes listed for sale. Metros areas including Miami, Naples, and Honolulu have the most available homes in these states. (Inspection Support Network)
Home Buyer Statistics
Everyone can be a homeowner with the right education, careful planning, and a home-buying team. Home buyers choose to own their home for a number of reasons: financial investment and security, comfort and privacy, and the flexibility of owning property.
Here’s a snapshot of U.S. home buyers and their motivations to become homeowners.
"West Virginia has the highest rate of homeownership at 74%." (Urban Institute, 2021)
- 53 percent of 2021 home buyers say outdoor living space is the most influential feature when deciding to make an offer, while 44 percent want adequate office space. (NerdWallet, 2021)
- The average American will own three homes in their lifetime. (McKendree, 2018)
- The majority of home buyers (64 percent) were very satisfied with their home purchase. (NAR, 2020)
“The biggest drivers for first-time buyers are The 5 Ds - Diamonds, Diapers, Diplomas, Dogs, and the Daily Grind. When renters get married, have babies, graduate, get a pet, or start a new job, they want to own a home.”
- 11 percent of Americans, or roughly 28 million people, said they planned to buy a home in 2021. (Nerdwallet, 2020)
- Gen X home buyers are the most wealthy buyers, with a median income of $113,300 (2019). This generation also prefers large homes, buying homes with a median 2,100 square feet. (NAR, 2021)
- In 2020, single females accounted for 19 percent of first-time home buyers. (NAR, 2020)
- 83 percent of 2019-2020 home buyers self-identified as white. Hispanic and Latino Americans represent the second-largest percentage of home buyers at 7 percent. (NAR, 2021)
- In 1994, homeownership rates for whites and African Americans was 70 percent and 41 percent, respectively — a 28.8 percent gap. By 2021, that gap had increased to 29.6 percent (74.2% vs 44.6%). (U.S. Census Bureau, 2021)
- In 1994, homeownership rates for whites and Latino Americans was 70 percent and 42.3 percent, respectively - a 27.7 percent gap. In 2021, that gap had fallen to 26.7 percent (47.5 vs. 74%) of white homeowners. (U.S. Census Bureau, 2021)
- The majority (82 percent) of 2021 home buyers have at least one higher education degree. (NAR, 2021)
- The average credit score for conventional loans is 756, 676 for FHA loans, and 720 for VA loans. (Ellie Mae, 2021)
- 38 percent of non-homeowners say down payment savings is their primary obstacle in buying a home, followed by their credit score (32 percent). FHA and VA loans provide opportunities for buyers with small down payments or low credit scores. (NerdWallet, 2021)
Millennial home lending
- Millennials (ages 27-41) are the largest generation of current home buyers, representing 37 percent of buyers in 2021. (Zillow, 2021)
- Young Millennials have the largest representation of unmarried couples buying homes at 20 percent. (NAR, 2021)
- 89 percent of older Millennial home buyers hold at least an associate’s degree — making them the most educated home buyers. (NAR, 2021)
- Millennial home buyers are the most likely buyer demographic to purchase urban property. (NAR, 2021)
Mortgage Questions From First-Time Home Buyers
You have mortgage questions and we have expert answers. Read up on these frequently asked questions and chat with us if you have additional questions.
What credit score do I need to buy a house?
Conventional mortgage loans are the most common and typically require a 620 minimum credit score. Of course, credit score minimums vary among lenders and mortgage loan types.
Many lenders offer FHA and VA loans to buyers with a 580 or higher credit score. FHA loans don’t technically have a credit score requirement, but most lenders want a score of 580 or better to approve your loan.
How much should I save to get a mortgage?
The simple answer is to save as much as you can comfortably afford and contribute to your down payment savings. The exact amount for your mortgage varies depending on your mortgage loan and lender requirements for approval.
USDA and VA loans have no down payment requirements, but your lender may have requirements for your approval. You may also want to save a larger down payment to lower your interest rates. Otherwise, you can secure a loan for 3-5 percent down and seek out down payment assistance.
You should also consider closing costs, moving costs, and other purchases that may come up once you buy your home. It’s a good idea to have extra savings in case of an emergency or home repair and maintenance, too.
What type of mortgage should I choose?
Your mortgage choice depends on your location, home type, and financial health and history. Here are common loan types and their requirements:
Conventional loans require:
- Credit score of 620
- A mortgage application
- 3 to 5 percent down payment
FHA loans require:
- Credit score of 580
- 3.5 percent down payment
- Loan lengths must be 15 years or longer
VA loans require:
- Credit score of 580
- Available to active service members and veterans.
- No down payment requirements
USDA loans require:
- Credit score of 620
- Available for homes located in rural areas.
- No down payment requirements
Jumbo loans require:
- Credit score of 680
- May require a down payment between 5 percent and 25 percent depending on credit and income
- More challenging to be approved for due to higher loan amounts.
Different mortgages and lenders have separate requirements for approval, like mortgage insurance. Consult with your lender to determine the best mortgage loan for you.
How many mortgages are there in the U.S.?
There are five types of mortgage loans available to Americans, with conventional mortgages being the most common. While there isn’t an exact number of mortgages in the U.S., 64 percent of Americans are homeowners with a combined total of $10.04 trillion in mortgage debt.
Buying a home is an exciting venture that can benefit your financial and emotional well-being. It also requires some extra education on the home-buying process and the current real estate industry. Read up on these mortgage facts and get pre-approved before you start house hunting.
Sources: Enact Mortgage Insurance