Costly Wedding vs. Home Down Payment?

Aaron crowe
Written by
Aaron Crowe
Read Time: 4 minutes

The average wedding costs around $20,000, which is almost enough money to make a 10 percent down payment on the median U.S. home sale price of $213,400.

By doing the math and standing back for an objective view of where to spend $20,000, a down payment on a house can look like the better long term option than a honeymoon that will only leave memories and a scrapbook of photos.

But as any married couple knows, objectivity and common sense can go out the window when planning a wedding. Who doesn't want to have a party?

In a recent survey by ERA Real Estate, a lot of women are willing to give up a honeymoon for a down payment - nearly 60 percent. Sixteen percent said they had already done so.

While the total cost of a wedding may not include the costs of a honeymoon - and even if it does, a honeymoon may not be the biggest cost of a wedding - the survey results do show that women are willing to give up part of the costs of a wedding if it will help them buy a house.

The survey also found that 49 percent of women would forego a big engagement ring to use the money for a down payment on a home, and that 17 percent had already done that.

A 'no-brainer'

For Amanda and Jon Thomas of Phoenix, Ariz., taking the $10,000 that they planned to spend on even a simple wedding and "using the money for the house versus a one-day event was an absolute no-brainer for us," says Amanda Thomas.

They closed on their home four months after they got married in a small ceremony on the beach in Hawaii that cost them about $1,500 for a five-day trip in 2006.

Jocelyn Allen, an office manager at a chiropractic office in Greenville, S.C., says she's pushing back her wedding a few months to March 2015 so she and her future husband can buy a home before they get married.

Their wedding budget is around $4,000, and they have a little more than $5,000 saved for a down payment on a house, Allen says.

A smart financial conversation to have

Putting off a wedding, or at least having a less expensive one, is an important conversation that couples should have, along with other expenses, says Cyndee Kendall, regional sales manager of the Northern California division for mortgage banking at Bank of the West.

"Is this the expense that you should take?" Kendall asks. "Just like the conversation, 'Should I buy a used car or a new car?'"

House down payments can be 3.5 percent for an FHA loan, and 10 percent is common for many loans, she says. The rule of needing 20 percent down is old and doesn't apply now, as it did about 20 years ago, Kendall says.

A home can build wealth for decades to come, compared to one day of wedding expenses.

"A wedding, as important as that is and a family event, it is just one day," Kendall says.

A winning proposal

Getting married is supposed to be a long-term commitment. But in a way, buying a house can be more of a commitment than a wedding, says Jacob Aldridge, a business coach in Australia who found a creative way to pay for his wedding and honeymoon.

Aldridge and his wife agreed to buy a home before getting married, and bought a fixer-upper. After making the home improvements and seeing the housing market rise, 12 months later they were able to borrow against the home's increased value to pay for their wedding and for a honeymoon in Italy.

The home won out first, but eventually they got both.

"It's a lot harder to get out of a mortgage than it is to get out of a marriage," Aldridge says. "So buying a house was more of a commitment than a wedding anyway."

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