The Case for Putting 20% Down on Your Next Home

If you are planning to buy your next home, you have probably heard the old rule about saving 20% for a down payment. Here is the honest version: you usually do not have to. Plenty of loan programs let qualified buyers put down far less. Yet a lot of repeat buyers are choosing to put down 20% or more anyway, and the reason says something useful about how to plan a move.

Why Repeat Buyers Put More Down

The gap between first-time and repeat buyers is real. According to the National Association of Realtors, the typical repeat buyer puts down about 23%, compared with roughly 10% for a first-time buyer (see graph below):

They are not simply wealthier. They are reusing money they already have. Most repeat buyers fund that larger down payment straight from the sale of their current home. NAR data shows the majority of repeat buyers use proceeds from a previous sale as a source of their next down payment (see graph below):

The mechanism is equity. Over years of ownership, two things happen at once: you pay down your loan balance, and your home's value climbs. The difference between what you owe and what the home is worth is equity, and for a longtime owner it can be substantial. If you already own, you may be holding more buying power than you realize.

What Kansas City Equity Makes Possible

This is where local prices matter. Home values across the Kansas City metro have kept rising, with the average sale price around $403,000 as of August 2026, up roughly 4% from a year earlier and higher still than it was several years ago. For a homeowner who bought before that run-up, the equity built along the way is exactly what turns a 20% down payment on the next home from a stretch into a realistic option. It is not that Kansas City owners have to put more down. It is that many now can.

There is a second local reason it can be worth doing. The Kansas City market is still competitive, with homes selling in about 39 days and sellers collecting close to 98% of their asking price. In a market that tight, a larger down payment is not only a financing choice, it is a negotiating asset, because sellers read it as a sign the deal is solid and likely to close.

What a Bigger Down Payment Buys You

As Redfin explains, putting more down pays off in a few concrete ways. Exactly how these apply to your loan is a conversation for a licensed lender, but the shape of the benefit is straightforward:

• A smaller monthly payment. The more you put down, the less you borrow at today's rates, which softens the sting of a higher mortgage rate.
• Less interest over time. Put 20% down and you pay interest on 80% of the price instead of 95%, which adds up across the life of the loan.
• No private mortgage insurance. On a conventional loan, putting down less than 20% usually adds a monthly PMI charge. Reach 20% and that cost typically goes away.
• A stronger offer. A larger down payment signals solid financing, which carries real weight in a competitive market like this one.

When Putting 20% Down Is Not the Right Move

A bigger down payment is not automatically the smarter one. Equity is money, and once it goes into the house it is hard to pull back out without selling or borrowing against it. Pouring every dollar of your sale into the down payment can leave you thin on the cash you will need for closing costs, moving, immediate repairs, or simply a reserve for the unexpected. There are also cases where keeping some of that money liquid, or using part of it to buy down your rate, does more for your monthly budget than crossing the 20% line. The point is not that 20% down is always right. It is that when your equity makes it possible, it becomes a real option worth weighing against the alternatives, rather than a box you have to check.

The Bottom Line

So, no, you do not need to put 20% down to buy your next home. But if the equity in your current house puts it within reach, going bigger can lower your monthly cost, cut the interest you pay over time, and make your offer harder to beat. The right number depends on your loan, which is a question for your lender, and on how much your current home will actually contribute, which is the part worth getting right before you shop. At Munkel Real Estate Solutions, that means pinning down what your current home is likely to net and how far it stretches toward the next down payment, so the move is built on a real figure rather than a rule of thumb.

Sources: National Association of Realtors, Redfin, and Heartland MLS/KCRAR.