Property Management Blog

How to Save for a Down Payment

Uptown Properties - Thursday, May 9, 2019

Saving for a down payment is one of the main reasons people do not think home ownership is an attainable goal. Many people intend to start saving for a down payment but life gets in the way. If you are considering putting 20% down on an average home in Portland you would be looking at about $90,000 out of pocket, not including closing costs. Of course, you could start off by looking for homes closer to the $300,000 price point so you would be looking closer to a $60,000 down payment. You may be thinking that you might be able to swing that in the next 20 years but if you want to buy in the next few years you are out of luck. 

Don’t be discouraged! There are many ways of fulfilling your goal of buying a house in the near future. 

One option is to put less than 20% down. If you have a good income but not a lot in savings it may be worth considering some of the low or no money down options. The less money you put down the higher your payments will be but it is definitely worth looking into. Consult a local lender to discuss options for putting less money down and down payment assistance programs. 

Here is a step by step guide to help you save for a larger down payment: 

Step 1: 

Establish a Goal. 

Example: Save $60,000 for a down payment on a $300,000 home. 

Step 2: 

Look at your current financial situation. Is there any money in your savings that you can set aside for a down payment already? 

Example: You have $10,000 in your savings already that you can use for a down payment. New goal: Save $50,000. 

Step 3: 

Find a good bank account to hold your money. This bank account should have a reasonable interest rate because you will likely not be touching this money for 5-8 years. The interest you get will help with closing costs, inspection fees, and other costs that go into buying a home. 

Example: You put that $10,000 into a separate and high interest bearing bank account. 

Step 4: 

Do an in depth analysis of what you spend on a monthly basis. Are there any unnecessary costs you can eliminate to help put more towards your savings? Determine how much you can put towards your down payment fund monthly.

Example: After all of your expenses are paid and putting some into your rainy day fund you have an  extra $500 coming in monthly. 

Step 5: 

If possible, adjust your paycheck to have money deposited directly into this bank account so you do not slip up and use that money for unnecessary purchases. 

Step 6: 

If you get a raise or have additional money coming in through other income streams don’t just increase your expenses, be sure to put a portion of your increased income towards your down payment costs. 

If you follow these steps you should be able to save enough for a 20% down payment within 5-8 years. Again, you do not have to come up with the full 20% down payment. You could start with 10% and talk to a lender to determine what that looks like on a monthly basis. 


Don’t forget to have money in another savings account to use when unexpected events occur. The common suggestion is to have at least 3 times your monthly expenses put away in case of unexpected issues like loss of employment. Again, make sure these accounts are separate so you have to think twice before dipping into your down payment savings.