The 20% Down Payment Myth—What You Really Need to Know
If you’re looking to buy property in California—whether it's a luxury home in San Francisco, an up-and-coming investment property in Redding, or your very first real estate purchase—there’s a persistent myth you’ve probably heard: you need to put 20% down to buy a home.
Here’s the truth: you don’t.
You Don’t Have to Put 20% Down
Unless you’re working with a specific lender or loan program that requires it, you likely won’t need to put 20% down. In fact, many buyers—especially first-timers—get in with much less. Here’s a quick look at the options:
FHA Loans: Minimum down payment of 3.5%
VA Loans: 0% down for qualified Veterans
USDA Loans: 0% down for eligible rural buyers
Conventional Loans: Some allow as little as 3% down
According to the National Association of Realtors, the median down payment for first-time buyers is just 9%—a far cry from that old 20% standard.
So whether you're looking at a multi-family duplex in Redding’s developing neighborhoods or a cozy starter condo in the East Bay, don’t let the 20% myth keep you on the sidelines.
Down Payment Assistance = Free Money You May Be Missing Out On
Here’s where it gets even more interesting—especially for those who are serious about building wealth through real estate:
Nearly 80% of first-time homebuyers qualify for some form of down payment assistance, yet only 13% take advantage of it. That’s a lot of potential funding being left on the table.
The average benefit? Around $17,000.
In high-cost markets like San Francisco, that kind of assistance can go a long way toward offsetting closing costs or even bumping up your purchasing power. Depending on your situation, you may even be able to combine multiple programs, giving your savings an extra boost.
These programs are especially relevant today as California continues to navigate inventory challenges, fluctuating mortgage rates, and increasing demand from both local and out-of-state investors. Tapping into available assistance could be the difference between waiting another year... or securing your next property now.
The Bottom Line
You don’t need to wait until you’ve saved 20% to buy property in San Francisco, Redding, or anywhere in California. Most buyers get in with far less, and with so many local and national assistance programs available, you might be closer to owning—or investing—than you think.
If you’re ready to take the next step, or just want to explore your options, I can connect you with trusted lenders and walk you through programs that fit your goals.
Let’s find the right path to your next property—and start building long-term wealth today.
