Real Estate Education Fleur Howgill August 11, 2023
Whether you are buying your first home or your next home, buying a home in Washington D.C. is a major financial commitment for any homebuyer.
As of June 2023, the median listing home price in Washington, D.C. was $650,000, trending up 5% year-over-year. Meanwhile, the national median home sales price during that same period was $416,100, down $33,200 from the previous year.
That’s why it is important to have a plan in place for building up a down payment fund to buy a home in Washington D.C.
How Much Should You Save to Buy a House in Washington, D.C.?
The first step should be figuring out your budget and how much money you’ll need to save up to buy a home.
That’s where a great local real estate agent can help. A real estate agent can help you find properties that fit in with your lifestyle, price range, and budget. They can also recommend other service providers, including a mortgage lender who can help you determine how much you can afford and get pre-approved for a loan.
In general, banks and other mortgage lenders prefer a down payment of around 20% of the home’s purchase price, so for a $650,000 home, a down payment would be $130,000.
However, if a homebuyer has excellent credit or can qualify for certain loan programs, like first-time homebuyer, VA, or FHA loans, lenders may consider a smaller down payment.
Just keep in mind: The bigger the down payment, the fewer remaining costs to finance, and the smaller the mortgage, the smaller the monthly payment.
Plus, with a 20% down payment, a homebuyer won’t have to pay private mortgage insurance (PMI), which typically gets added to the monthly payment as well.
In addition to the down payment, soon-to-be homebuyers should plan on saving an additional 2.5-4% in closing costs, $250-$400 for an appraisal, and $200-$600 for a home inspection.
How to Save Money for a House in Washington, D.C.?
Now that you know how much you’ll need to save to buy a house in Washington, D.C., it’s time to start saving! Here are a few tips to help minimize expenses and maximize savings.
Are you ready to buy a house in Washington, D.C.?
Buying a house in Washington, D.C. can be overwhelming, but having an experienced real estate agent at your side can make the whole process much more manageable. They can help you navigate the housing market, guide you through your financial options, and negotiate the best deal possible.
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Fleur and Veronique's passion for travel has significantly enriched their understanding of diverse cultures and unique requirements. Their personal experience as expatriates further enhances their ability to cater to the needs of an international clientele seeking insight into life in Washington DC. Fleur's remarkable history of achievements serves as a testament to her expertise. Don't hesitate to contact Fleur's team to discover more about how they can assist you!