Tens of millions of people are watching videos of home buyers sitting in empty houses

By Weston Blasi

It costs a lot more to buy a house today than it did just a few years ago. And that expense starts with the down payment.

Buying a house is so expensive these days that many home buyers have little money left over afterward.

Making light of this struggle to afford a house, TikTok users have taken to making videos of them sitting in empty dwellings, with the caption, "When you had just enough for the down payment."

"People often become 'house poor' because they lack a clear strategy when purchasing their home," Shasta Townsend, a real-estate strategist and Chief Executive of Property Rich Empire, told MarketWatch. "They get swept up in the excitement and realtor hype, overlooking the importance of having a solid plan and understanding their finances."

In the videos, people show themselves enjoying their new residences - often with no furniture or household items inside. In many instances, these people post themselves eating on the floor instead of a table, napping on the floor instead of a bed, and watching a blank wall instead of a TV. Here are a few examples.

MarketWatch has reached out to several TikTok creators who have posted these types of videos.

Of course, these people will end up furnishing their houses and are exaggerating to be funny. But it is a greater struggle now to afford a down payment than it has been in years. Home prices reached an all-time high in June, and mortgage rates are still hovering near 7%,

The median price of a home in the U.S. in 2019 was $313,000, but in 2024 it jumped to $420,800 - a 34% increase in just five years, according to the Federal Reserve Bank of St. Louis.

The 30-year fixed-rate mortgage average was 6.86% as of June 27, according to data released by Freddie Mac. That's up from a record-low 2.65% in January 2021.

This all means it costs a lot more to buy a house today than it did just a few years ago. And that expense starts with the down payment.

Videos like these have amassed over 10 million views on social media, and come as pending U.S. home sales fell to an all-time low in May.

See also: Buying a home can't get any worse, right? It can - and probably will.

How much money to put toward a down payment can vary by type of buyer and type of offer, but typically the goal has been to put down 20% of a home's final sale price. If you put down less than 20%, private mortgage insurance is usually needed, which can cost up to 1.5% of the loan amount each year.

But most home buyers put down less than 20%. The typical down payment for first-time buyers was 8% in 2023, up from 6% the previous year, per the National Association of Realtors. And it was 19% for repeat buyers.

A 20% down payment on a median-priced home today would be $84,160.

"It's like starting a million-dollar business without a business plan or financial backing - you wouldn't do it, yet many homeowners take on this significant investment without the same level of preparation," Townsend said. "This can lead to unexpected expenses and financial strain, making it difficult to afford even basic furnishings for their new home."

How can people prevent themselves from being "house poor?" One way is to follow the 30% rule - not spending more than 30% of their income on housing.

Read on: 4 beach towns where you can still buy a home for $250,000 or less

It's not always easy to do in today's market. According to a 2024 Zillow analysis, a home buyer making the median income in the U.S. today would need to spend $127,750 on a down payment for their total monthly costs on a $360,000 home to not exceed the oft-cited 30% rule. That's a 35.4% down payment.

"Down payments have always been important, but even more so today," Skylar Olsen, chief economist at Zillow (Z), explained in the report. "With so few [houses] available, buyers may have to wait even longer for the right home to hit the market, especially now that buyers can afford less."

Despite soaring costs, 82% of Americans say they view buying a home as a good investment.

Also read: 'He thinks I'm too materialistic': My husband and I are in our 40s with two kids. He takes zero interest in our finances. He doesn't even know the name of our mortgage company.

-Weston Blasi

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07-02-24 1258ET

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