Down Payments Surge as Homebuyers Seek Shield From Rising Mortgage Rates

Homebuyers in expensive, competitive markets are jacking up their down payments to insulate themselves from surging mortgage rates—while those in well-supplied areas with softening prices are taking a different path.The latest downpayment report from Realtor.com® shows that the national median down payment in the second quarter of 2026 climbed to $27,100, or 13.7% of the typical purchase price, up from 12.9% at the start of the year. "The second quarter is typically the seasonal peak for down payments, and this year's rebound from Q1 was especially pronounced," says Realtor.com senior economist Hannah Jones. She attributes this shift to the mortgage rate run-up that began in March following the outbreak of the war with Iran.On an annual basis, however, the typical down payment fell from 14.3% year over year, recording the lowest second-quarter level since 2021—and signaling an overall cooling national housing market.The relationship between down payments and mortgage rates is straightforward: As rates rise, financially prepared home shoppers with ample cash reserves often put down more money upfront to reduce their long-term borrowing costs.Crucially, that strategy works only for s...