National Homeownership Month Highlights the Need for Expanded Down Payment Assistance

June heralds the beginning of summer, a time of growth, renewal, and new beginnings. Appropriately, June is also National Homeownership Month, a period to celebrate the American dream of homeownership and recognize its numerous benefits.

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Homeownership is a cornerstone of American values and a key to building a strong middle class. Not only does it offer a sense of stability and pride, but homeownership has a profound impact on individuals, families, and communities. Residential stability among homeowners is linked to improved life satisfaction, increased civic participation and improved educational outcomes for children, along with better physical and mental health. However, in today’s market, the majority of potential buyers face significant challenges. Affordability and saving for a sufficient down payment are the primary hurdles for potential homeowners.

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Economic Challenges for Today’s Buyers

It’s no secret that the economic landscape presents unique challenges for Millennials and Gen X-ers, who often carry significant student loan debt. With more than half of these individuals renting and the national average rent-to-income ratio at 30%, saving for a down payment is increasingly difficult. Over the past five decades, increasing wage inequality has become a defining characteristic of the American economy. Since the late 1970s, inflation-adjusted wages for the majority of U.S. workers have remained largely stagnant. This, combined with rising costs of goods and services, makes down payment assistance (DPA) a vital option.

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Homeownership Benefits and Statistics

Homeownership is more than just owning property; it’s an investment in the future. U.S. homeowners have a net worth 40 times higher than renters—$225,000 compared to $6,300. This wealth gap underscores the financial stability and equity-building power of homeownership. Homeownership also promotes intergenerational wealth building, with children of homeowners transitioning to homeownership earlier and at higher rates than children of renters.

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Currently, the U.S. homeownership rate stands at 63.7%. The average first-time homebuyer is about 33 years old, primarily from the Millennial generation. Among Americans aged 65 and older, approximately 80% own their homes, the highest homeownership rate among all age groups. States like West Virginia, Michigan, New Hampshire, Delaware, and Maine boast homeownership rates of 70% or higher, and every state maintains a rate of at least 50%.

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According to the National Association of Realtors, homeownership also confers numerous social benefits, including greater political awareness, higher membership in voluntary organizations, better health outcomes, lower teen pregnancy rates, higher student test scores, and increased high school graduation rates. Moreover, homeownership offers freedom in creating one’s living environment and has positive tax implications, such as deductible mortgage interest and property tax payments.

Click n’ Close’s Commitment to Homeownership

Since 2020, Click n’ Close has provided over $1 billion in Down Payment Assistance (DPA) financing, aiding more than 4,000 borrowers with nearly $10,000 each on average. Unlike conventional loan structures, our SmartBuyTM Down Payment Assistance (DPA) program offers both forgivable and non-forgivable second liens, providing borrowers with flexible options tailored to their financial needs. With no income limits and innovative features such as a 10 year repayable option with a 30-year amortization and a 2-1 buydown, the possibilities for homeownership are extensive.

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June is Homeownership Month, a time to celebrate the significant impacts of owning a home and reaffirm our commitment to helping more individuals achieve this dream. As lenders, we should continuously seek ways to support potential homeowners. DPA remains a critical resource in this endeavor. For more information please contact me at [email protected].