Home Ownership Key: How Much Money Do You Need to Save to Buy a Home?

Aug 25

Aug 25 Home Ownership Key: How Much Money Do You Need to Save to Buy a Home?

I’ve been asked a few times in the last few weeks “How much money do I really need to buy a home?”

I’m glad you asked. The short answer is I don’t know because it depends on the type of property you buy (single-family home, condo, coop), how much money you put down, how much the transfer taxes are, are you doing any renovations. So, I can’t give you a magic number because the amount you need to save is completely unique to your situation.

What I can do is give you an idea of costs you will or might have so you can plan for them because no one wants to buy a home and completely clean out their bank account at the same time. Here are costs you should plan for:

Down Payment - this will vary based on the type of loan. Talk to a few lenders to see what they are able to offer you and to learn more about any first-time home buyer programs you might be eligible for.
Closing Costs – 2-3% of purchase price in DC. Your lender will be able to give you specifics based on your situation.
Cleaning – $400-500 If you choose to have your new home deep cleaned before you move-in, expect to have it cost more than your regular cleaning bill.
Moving – This is dependent on the amount of furniture you are moving. Reach out to several movers for estimates. Your real estate agent should also be able to recommend some.
Painting and Misc. Repairs – If you want to have painting and a few minor repairs done. This will be dependent on the size of the home you buy and the specific repairs.
Parking permits for the moving truck - This is really for city dwellers. In DC, permits are currently $55 each.
Move-in fees – If you purchase a condo/coop there are usually move-in fees charged by the building. These usually range from $250-750, but make sure to confirm this before your settlement and move.
Trash Hauling – The property will likely be empty, but in the event it’s not you might need to hire a trash hauler. The fee for this will be dependent on what needs to be taken away.
Renovations - this could be a post of its own. If you’re not buying a home that’s move-in ready be sure you have a renovation budget set aside and have your contractor visit properties you are interested in purchasing if possible to give you an estimate of the renovation costs.