Owning a home is within reach in these 10 cities, where buyers need less cash to achieve the American Dream

• Realtor.com has identified the top 10 US cities where homebuyers make the smallest down payments.
• "A lot of folks just don't have that extra cash," the report's author said of 20% down payments.
• Killeen, Texas, tops the list with the average down payment coming in at 5.3% of the purchase price.

High home prices and mortgage rates are locking many people out of the housing market.

But there are still certain places in the country where buyers might be able to get their foot in the door sooner. Realtor.com has tracked the ten cities where buyers are making the smallest down payments. For many, a smaller down payment could bring the American Dream of homeownership within grasp.

It comes as no surprise that all of the cities in the top 10 are in the South and Midwest, two regions noted for their affordability. Four of the cities are also home to military bases, increasing the chances of buyers being military personnel who can utilize Veteran loans, which allow for down payments as low as 0%.

While buyers are typically advised to make a down payment of up to 20% when purchasing a house to ensure a lower interest rate, Clare Trapasso, the author of the report and Realtor.com's executive news editor, told Insider that many buyers just can't afford to right now.

"The median home list price nationally is $429,500 and if you wanted to put 20% down, you're looking at almost $85,900 — that doesn't even include closing costs," Trapasso said. "You also have to pay movers and buy furniture. A lot of folks just don't have that extra cash."

Using data from financial technology firm Optimal Blue, Realtor.com analyzed the average down payments as a percentage of the home sale price in the 150 largest metropolitan areas during the third quarter of 2023. The company only used one metro area per state to ensure geographic diversity.

These are the top 10 cities where homebuyers are making the smallest down payments, according to Realtor.com.

10. Peoria, Illinois

Average down payment: 10%
Median down payment: $8,258
Median home list price: $168,950

9. Lakeland, Florida

Average down payment: 9.4%
Median down payment: $7,271
Median home list price: $358,793

8. Gulfport, Mississippi

Average down payment: 8.9%
Median down payment: $5,265
Median home list price: $299,900

7. Virginia Beach, Virginia

Average down payment: 8.7%
Median down payment: $6,726
Median home list price: $379,500

6. Mobile, Alabama

Average down payment: 8.5%
Median down payment: $5,048
Median home list price: $255,000

5. Augusta, Georgia

Average down payment: 8.3%
Median down payment: $5,586
Median home list price: $302,430

4. Huntington, West Virginia

Average down payment: 8.2%
Median down payment: $4,802
Median home list price: $179,900

3. Shreveport, Louisiana

Average down payment: 6.7%
Median down payment: $4,587
Median home list price: $245,000

2. Fayetteville, North Carolina

Average down payment: 5.9%
Median down payment: $2,779
Median home list price: $330,000

1. Killeen, Texas

Average down payment: 5.3%
Median down payment: $2,182
Median home list price: $325,000