Saving for a mortgage down payment is a significant barrier to homeownership that particularly hits communities of color. We calculate how long it would take for a typical renter household to save for a mortgage down payment and closing costs for a median-priced house (“Years to Save”) and further disaggregate these calculations by race/ethnicity, household type, location, and occupation. We also discuss the impact of student loan borrowing on wealth and liquid savings for young households that have attained at least a bachelor’s degree and the likely impact on Years to Save of repaying student debt.

The findings that follow reflect a dire need for targeted down payment assistance and other programs such as student debt relief that would clear a path to homeownership. Notably this need is based on household financial status before the devastating health and economic impacts of the Covid-19 pandemic and is therefore likely to be even greater than represented here going forward.

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