This article estimates the cost of buying a home in Washington State, using median home price data and average mortgage rates as of March 2017. Please contact us for a more precise estimate of your potential home-buying costs.
Cost of Buying a Home in Washington State: 2017
What’s the current cost of buying a home in Washington State, in 2017? That largely depends on where you live. Home prices vary widely throughout the state, and are highest in and around Seattle. For this overview, we will be using median and average figures for the state as a whole.
1. Median home price is around $318,300.
According to the real estate data company Zillow, the median home price for the state of Washington was $318,300 in March 2017. That was 10% higher than a year earlier. Of course, prices are higher in the Seattle metro area, and also in San Juan County. But for the purposes of determining home buying costs statewide, we’ll use $318,300 as our starting figure.
2. An average down payment is around 10%.
The minimum down payment for a mortgage loan in Washington State can vary based on the type of loan being used and other factors. Conventional home loans offer down payments as low as 3% these days. The FHA program allows borrowers to put 3.5% down. And military members can use a VA loan to finance 100% of their purchases.
But the average down payment in Washington is higher than these minimum requirements. On average, home buyers across the state make down payments of around 10%. Ten percent of the $318,300 median home price mentioned earlier is $31,830.
But don’t be too concerned if you can’t afford a down payment of that size. As mentioned earlier, there are low-down-payment options available as well.
The down payment is an out-of-pocket cost of buying a home in Washington. It’s an investment that must be paid at closing. But the money doesn’t necessarily have to come from your own pocket. Many mortgage programs today allow borrowers to use down payment gifts from family, close friends, and other approved donors.
3. Mortgage rates are currently hovering in the low to mid 4% range.
As of the third week of March 2017, the average rate for a 30-year fixed-rate mortgage loan was 4.3%. That’s based on the weekly survey conducted by Freddie Mac. Borrowers with excellent credit, and/or those who use an adjustable-rate mortgage loan, can often qualify for better-than-average rates.
But the 30-year fixed is by far the most commonly used mortgage loan product in Washington, so that’s what we’ll use to continue our cost analysis.
4. The average monthly payment in this scenario would be around $1,418.
Using a loan amount of $286,470 and a mortgage rate of 4.3%, the monthly payments would come to around $1,418. That’s if they were spread over 30 years, as would be the case when using a standard 30-year fixed mortgage loan.
5. Average closing costs when buying a home in Washington: around $10,000.
Closing costs typically average around 3% to 4% of the loan amount (though they can fall outside this range in some cases). In this scenario, our base loan amount was $286,470. That would put the closing costs somewhere between $8,594 and $11,458, most likely. But there are many variables that can affect closing costs. This is just an estimate.
This is a theoretical look at the cost of buying a home in Washington State, heading into spring of 2017. As you can see from this exercise, there are many variables that can influence the actual costs you pay when buying a house in Washington — and we didn’t even talk about discount points or mortgage insurance.