I Do! (Want a Home)

A new analysis conducted by Zillow Home Loans and The Knot shows that more couples than ever who are planning to marry are registering for home funds to help them buy a house, in addition to more traditional wedding gifts. Many couples are getting creative to make their dream of homeownership a reality.

According to The Knot, the share of couples including "home funds" as part of their wedding registry has increased 55% since 2018. Now, nearly 20% of all couples registered on The Knot are asking their guests to help them with the down payment on their first home.

"Home funds were one of the most popular wedding registry cash funds on The Knot in 2022—the second, in fact, right behind the honeymoon fund," said Esther Lee, Deputy Editor of The Knot. "It's wonderful that couples feel empowered to make their registries ultra-personal to their goals, especially as they enter marriage together. While guests prefer to give cash gifts for celebratory treats, like a sunset honeymoon dinner, milestone gifting is a profoundly thoughtful and significant trend we're seeing among couples planning on The Knot. Amid rising interest rates and historic highs for down payments, this particular wedding contribution helps newlyweds reach another meaningful life milestone: homeownership."

Recent research from Zillow shows that half of all home buyers are purchasing their first home, the highest share that Zillow has ever recorded. Between 2018-2022, first-time buyers were at least twice as likely to report putting gift funds toward their down payment. And most recently in 2023, 43% reported gift funds from friends and family as the source of at least part of their down payment funds.

Affordability is the greatest hurdle facing first-time home buyers, and it now takes an average of nearly 12 years for a typical first-time buyer to save for a down payment, compared to nine years prior to the pandemic. Meanwhile, the typical monthly mortgage payment has more than doubled in that time. For a $350,000 home and assuming a 20% down payment, a couple would need to save approximately $70,000 for a down payment and expect to spend $2,334 a month on a mortgage payment.

Further compounding affordability matters for potential buyers, Freddie Mac’s latest Primary Mortgage Market Survey (PMMS) shows that the 30-year fixed-rate mortgage (FRM) averaged 7.63% for the week ending October 19, marking the sixth consecutive week of increases in the 30-year FRM. A year ago at this time, the 30-year FRM averaged 6.94%.

"Young couples may be eschewing convention when it comes to their weddings, but they still aspire to achieve the age-old American dream of homeownership," said Amanda Pendleton, a Personal Finance Expert at Zillow Home Loans. "That dream, however, can feel out of reach without the right support. For couples who choose to add down payment funds to their registry, it's important that they also work with a qualified loan officer to understand what they can afford and what loan options fit their situation. First-time buyers often think a 20% down payment is required, but that's not always the case. Some may qualify for a down payment as low as 3%, which will change their savings timeline and monthly payment dramatically."

Zillow data shows that most first-time buyers are putting down between 10% and 19%. Approximately one in three buyers also report receiving some kind of grant toward their down payment, most commonly from a bank or credit union. For first-time buyers, almost half report getting some kind of down payment assistance. Buyers of color are more likely to benefit from these grants; Zillow data indicates that 47% of buyers of color reported using some form of down payment assistance. Buyers can find available down payment assistance programs on all for-sale listings on Zillow.