How much of a down payment do I need to buy a house in Washington?

Depending on which program you may be eligible for, you can get up to $15,000 or 5% of your home's purchase price in the form of down payment assistance. Although many home buyers in Washington will qualify for this assistance, not everyone will. You can also get a zero down payment mortgage through the VA or USDA, should you qualify. In addition, conventional mortgages typically only require 3% down, and FHA mortgages just 3.5%.

How much are closing costs in Washington?

Washington's closing costs can be very substantial, largely due to the price of homes in the state. On average, a buyer will pay $13,927 at closing, or about 2.4% of their new home's value.

What does homeowners insurance cost in Washington?

Home values are pretty variable across the state, but you can expect to pay about 40% less than the national average for your homeowners insurance. For a $400,000 home, you will pay about $2,017; for $600,000, it will be about $2,801 yearly. These prices may go up as climate change has larger impacts on homes in the state, and may be considerably higher in areas at risk from wildfires.

What is the property tax rate in Washington?

Washington ranks 23rd in the nation for property tax as a percentage of assessed value, at 0.92%. Due to the high cost of housing in Washington, the tax rate as a percentage of income is quite high, at 3.65%, or 11th in the nation.

Washington Mortgage Calculator

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Is the Evergreen State calling you? Washington is home to a wide range of environments, from urban to dramatically rural, with something for everyone. If you're considering making it your home, give our Washington mortgage calculator a try so you can better prepare for your home-related costs there. Simply plug in some numbers to learn what your costs might be.

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Washington housing market

Washington can be a challenging place to find an affordable home, with the median sales price of homes approximately 50% higher than the national median home sales price. Housing prices peaked in May 2022, and have pretty much leveled off since then, allowing national prices and incomes a little time to catch up.

Short housing inventory is a chronic characteristic of this market, with the supply of homes running at or below two months continuously for the last five years. This has pushed days on the market to some pretty extreme lows, especially in the period between May 2020 and August 2022, when it never topped 20 days.

Washington is an incredibly competitive market to try to buy a home in, so be sure that you've already met with your mortgage lender to discuss the best mortgage rates and get your pre-approval letter long before you start to look at homes. This way, you'll be ready to buy when you see the home of your dreams, and not have to wait and worry that you won't have a chance to put in an offer.

Here's a quick snapshot of some of the most important Washington markets and how home prices are trending there.

Metropolitan Area	Median Home Sales Price	1-Year Change
Seattle	$847,500	11.5%
Spokane	$373,900	6.9%
Tacoma	$475,000	3.3%
Vancouver	$485,000	(0.51%)
Bellevue	$1,500,000	7.8%
Kent	$640,000	9.4%
Everett	$600,000	12.1%
Spokane Valley	$419,998	0.3%
Renton	$727,500	7.1%

Data source: Redfin. Figures accurate as of May 7, 2024.

How do I calculate my mortgage payment?

Using a mortgage calculator like this one is the quickest and easiest way to calculate your mortgage payment. But if you're financially curious, the formula looks like this:

The mortgage payment you get from this formula just tells you the combined principal and interest payment, not what the entire payment will be. Most mortgage payments today include additional fees, including payments that contribute to your escrow account, which is later used to pay for larger items like insurance or taxes.

A full modern mortgage payment is made up of the principal and interest, plus other things like:

Mortgage insurance, like MIP for an FHA Loan or PMI for a conventional
Homeowners insurance
Homeowners association dues
HOA assessments
Flood insurance
Wildfire insurance

To calculate your new mortgage with these additional expenses included, just click "show additional inputs" on the mortgage calculator above and add your estimated figures. It will get you a very close estimate of what to expect.

Things to know before buying a house in Washington

Washington's real estate can be very expensive, but the good news is that its property tax rates are pretty average. It ranks 23rd in the nation for property taxes as a percentage of value, at 0.92%. That means that if your home's assessed fair market value is $287,200, your taxes will be $2,631 per year.

The state has seen an average amount of warming due to climate change, compared to the rest of the country. That's not good, though, as it still has serious consequences. Glaciers are retreating and the snowpack is melting earlier than it should, meaning less water available for streams in summer, when it's needed most. Sea levels are also rising, putting coastal properties in Washington at risk of flooding and worse. And, lastly, droughts caused by the earlier melts are contributing to an increase in wildfires, which can threaten homes and make air unsafe to breathe.

While a basic homeowners insurance policy may be enough coverage for many parts of the state, you could also benefit from optional flood or wildfire coverage in other areas. Ask your insurance agent what's appropriate, even if it's not required by your lender. You can also plug that number into the Washington mortgage calculator to help give you a better estimate of your overall payment.

Tips for first-time home buyers in Washington

There are several down payment and closing cost assistance programs available for first-time home buyers. They're available through the Washington State Housing Finance Commission. Each is subject to income qualifications and requires you attend a home buyer education course before funds will be disbursed.

Home Advantage DPA

The Home Advantage DPA is the main program used in Washington, which allows for up to an additional 5% of your loan amount to be used as your down payment or closing costs. This is in the form of a second mortgage with no payments due unless you refinance, sell, or pay off your primary loan.

Home Advantage DPA Needs Based Program

The Home Advantage DPA Needs Based Downpayment Assistance is a slightly different program from the straight Home Advantage DPA program. With this loan, you can get up to $10,000 as a second mortgage, financed for 30 years at 1%. The income cap for this program is very tight, however, with residents of King and Snohomish counties not to exceed $147,400 in yearly income, and other residents of Washington to not exceed $115,900 in yearly income.

Opportunity DPA

The Opportunity DPA program offers borrowers up to $15,000 in down payment and closing cost assistance at a 1% interest rate for 30 years as a second mortgage. Income caps apply, with households in the most expensive counties not to exceed $110,950 in yearly income. The program issues this second mortgage based on need.

Advice for all first-time borrowers

Whether or not you qualify for down payment assistance in Washington, you can still apply for other loans with appealing terms for first timers, like FHA loans or conventional loans. Both have low down payment requirements, making them easier to secure, and can be used on a vast array of homes.

Regardless of what program you use, every first-time home buyer should make themselves look like the best mortgage candidate possible. This includes:

Maintaining steady employment for at least two years.
Keeping your down payment funds in a separate account to allow them to season.
Paying down as much debt as possible to lower your debt-to-income ratio.
Making payments on time to improve your credit score.

It's also important to remember not to do anything drastic with your credit or change your employment between your pre-approval and closing. Your underwriter will review your file multiple times during the process, and will check again to be sure you still qualify just prior to closing. If you've taken out a new credit card, charged up existing credit lines, changed jobs, or neglected your payments, you could risk having your loan approval revoked.

FAQs

Depending on which program you may be eligible for, you can get up to $15,000 or 5% of your home's purchase price in the form of down payment assistance. Although many home buyers in Washington will qualify for this assistance, not everyone will.
You can also get a zero down payment mortgage through the VA or USDA, should you qualify. In addition, conventional mortgages typically only require 3% down, and FHA mortgages just 3.5%.
Washington's closing costs can be very substantial, largely due to the price of homes in the state. On average, a buyer will pay $13,927 at closing, or about 2.4% of their new home's value.
Home values are pretty variable across the state, but you can expect to pay about 40% less than the national average for your homeowners insurance. For a $400,000 home, you will pay about $2,017; for $600,000, it will be about $2,801 yearly. These prices may go up as climate change has larger impacts on homes in the state, and may be considerably higher in areas at risk from wildfires.
Washington ranks 23rd in the nation for property tax as a percentage of assessed value, at 0.92%. Due to the high cost of housing in Washington, the tax rate as a percentage of income is quite high, at 3.65%, or 11th in the nation.

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