Bigger Down Payments Block Young Home Buyers

Banks stay cautious in lending to first-time purchasers
Potential home buyers outside a previously owned home in Mackinaw, Ill., on April 21 Photograph by Daniel Acker/Bloomberg

The challenges facing prospective buyers of the least expensive homes in the U.S. are mounting. Already beset by stagnant wages, student debt, and competition from speculators who have been snapping up listings, Americans looking to purchase moderately priced houses must now provide more cash upfront. The median down payment for the cheapest 25 percent of properties sold in 2013 was $9,480, compared with $6,037 in 2007, according to data from 25 of the largest metro areas compiled by brokerage firm Redfin.

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