Key Takeaways:
– The share of couples including “home funds” as part of their wedding registry has increased by 55 percent since 2018.
– This trend is due to the increasing unattainability of homeownership.
– Nearly 20 percent of couples registered with The Knot ask their wedding guests to contribute funds to help them with a down payment on their first home.
– Half of all current prospective homebuyers are in the market to purchase their first home.
– Affordability and availability are the greatest hurdles for first-time homebuyers.
– It now takes nearly 12 years for a typical first-time buyer to save up for a down payment, compared to nine years prior to the pandemic.
– Some couples may qualify for a down payment as low as 3 percent, which can dramatically change their savings timeline and monthly payment.
inman:
The share of couples including “home funds” as part of their wedding registry has increased by 55 percent since 2018, according to a joint analysis released Thursday by Zillow and The Knot.
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With homeownership reaching new levels of unattainability, more newlywed couples are turning to their gift registry to help buy a home, according to a new analysis by Zillow released Thursday.
According to the joint analysis from Zillow Home Loans and the wedding media company The Knot, the share of couples including “home funds” as part of their wedding registry has increased 55 percent since 2018, with nearly 20 percent of all couples registered with The Knot asking their wedding guests to contribute funds to help them with a down payment on their first home.
“Home funds were one of the most popular wedding registry cash funds on The Knot in 2022 — the second, in fact, right behind the honeymoon fund,” said Esther Lee, deputy editor of The Knot.
“Amid rising interest rates and historic highs for down payments, this particular wedding contribution helps newlyweds reach another meaningful life milestone: homeownership.”
Recent research from Zillow shows that half of all current prospective homebuyers are in the market to purchase their first home, the highest share they have ever recorded. In 2023, 43 percent of first-time buyers reported using gift funds from friends and family to help make their down payment, according to the report.
With mortgage rates now hovering around 8 percent, affordability and availability are the greatest hurdles for first-time homebuyers. It now takes nearly 12 years for a typical first-time buyer to save up for a down payment, compared to nine years prior to the pandemic, according to Zillow. In that same period, the typical monthly mortgage payment has more than doubled.
For a $350,000 home asking a 20 percent down payment, a couple would need to come up with $70,000 for a down payment and expect to spend $2,334 a month on a mortgage payment, the study notes.
“Young couples may be eschewing convention when it comes to their weddings, but they still aspire to achieve the age-old American dream of homeownership,” said Amanda Pendleton, a personal finance expert at Zillow Home Loans.
“That dream, however, can feel out of reach without the right support. For couples who choose to add down payment funds to their registry, it’s important that they also work with a qualified loan officer to understand what they can afford and what loan options fit their situation. First-time buyers often think a 20 percent down payment is required, but that’s not always the case. Some may qualify for a down payment as low as 3 percent, which will change their savings timeline and monthly payment dramatically.”
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Property Chomp's Take:
Did you know that more and more newlywed couples are turning to their wedding registries to help buy a home? According to a joint analysis by Zillow and The Knot, the share of couples including "home funds" as part of their wedding registry has increased by 55 percent since 2018.
With homeownership becoming increasingly unattainable for many, couples are finding creative ways to achieve their dream of owning a home. By asking their wedding guests to contribute funds towards a down payment, couples are able to make a significant step towards homeownership.
The analysis revealed that nearly 20 percent of all couples registered with The Knot are now asking their guests to contribute funds to help them with a down payment on their first home. In fact, "home funds" were the second most popular cash fund on The Knot in 2022, just behind the honeymoon fund.
This trend comes as no surprise given the current state of the housing market. Half of all current prospective homebuyers are looking to purchase their first home, which is the highest share ever recorded. However, with mortgage rates hovering around 8 percent and affordability and availability being major hurdles, it now takes nearly 12 years for a typical first-time buyer to save up for a down payment.
For example, a couple looking to buy a $350,000 home would need to come up with $70,000 for a down payment and expect to spend $2,334 a month on a mortgage payment. These numbers can be daunting for young couples just starting out, which is why the option of adding down payment funds to their wedding registry is so appealing.
It's important for couples who choose this route to work with a qualified loan officer to understand what they can afford and what loan options fit their situation. Many first-time buyers assume that a 20 percent down payment is required, but that's not always the case. Some may qualify for a down payment as low as 3 percent, which can significantly change their savings timeline and monthly payment.
Overall, this trend highlights the determination of young couples to achieve the age-old American dream of homeownership. By utilizing their wedding registry as a means to gather funds for a down payment, couples are taking a proactive approach to making their dream a reality.
So if you're a soon-to-be-married couple dreaming of owning your first home, consider adding "home funds" to your wedding registry. It's a practical and meaningful way for your loved ones to contribute to your future and help you take that important step towards homeownership.
