John Skinner
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Approximately 25% of the purchases on the Westside above $900,000 are all cash buyers. Unfortunately, they almost have to be. As you can see from the above graph, 24.1% is the average down payment for a home in Los Angeles. It’s a shame the banks were stupid enough (how bankers have not gone to jail for it is disgusting) to allow the average down payment to literally drop to almost 0% in 2006-2007. Are you kidding me? We are going to pay for this insanity for a long time with over 670,000 California homeowners underwater by more than 50% according to Mooney’s analytics.
If people actually have the financial discipline to save 20 percent then it is likely they have more of a buffer to ride out any storms in housing. Plus it is a lot harder to walk away from that type of savings.
