How much money should you have before buying a house in Houston, Texas? The exact amount of money varies depending on your budget, home prices in your desired neighborhoods, closing costs, maintenance expenses, loan terms, and final negotiations with the seller.

In this post, our team at Your Home Sold Guaranteed Realty - Chris Schmidt Team will discuss the factors you should consider when creating a home-buying budget, and what to consider when setting a budget to buy a home in Houston.

Key Takeaways:

• In recent months, homes in Houston sold for a median price of $309,000, which is a 4.7%  increase compared to the same time last year. 
• If you buy a home around the median price of $310,000, and pay a down payment between 5% to 20%, you’d be paying anywhere from $15,500 to $62,000.
• Your emergency fund should cover at least a few months’ worth of your monthly mortgage payments. For a $310,000 home with a 20% down payment, that could mean setting aside around $6,000.

What Factors Should You Consider When Setting a Budget?

• Down Payment: In general, it’s recommended to have a down payment of at least 20% of the home’s purchase price to avoid private mortgage insurance. However, there are financial assistance programs available that allow for lower down payments.
• Closing Costs: Closing costs typically range from 2% to 5% of the purchase price of the home and cover fees such as loan origination fees, appraisal fees, title insurance, escrow fees, and more.
• Emergency Fund: It’s advisable to have an emergency fund set aside to cover unexpected expenses that may arise during the home-buying process or after moving into your new home. Try to save enough for at least several months worth of monthly mortgage payments.
• Monthly Housing Expenses: Consider your ongoing monthly housing expenses, including mortgage payments, property taxes, homeowners insurance, utilities, maintenance, and HOA fees. Make sure your budget allows for these expenses without stretching yourself too thin financially.

What is the Housing Market Like in Houston, Texas?

In recent months, homes in Houston sold for a median price of $309,000, which is a 4.7%  increase compared to the same time last year. Most homes spend a median of 47 days on the market, which is a decrease of three days from the previous year.

Most homes sell for 3% below their original asking price, while the hottest homes sell for their exact original listing price. The hottest homes also sell faster, spending only 11 days on the market before selling.

Homes in Houston have a sale-to-list price ratio of 96.5% and 11.1% of homes sell above their original asking price. In addition, 26.2% of homes drop their asking price at some point after being listed.

How Much Money Should You Have Before Buying a House in Houston?

If you buy a home around the median price of $310,000, and pay a down payment between 5% to 20%, you’d be paying anywhere from $15,500 to $62,000. Of course, if you qualify for a down payment assistance program you could pay as low as zero down. For closing costs, you’d pay between $6,200 and $15,500. 

Your emergency fund should cover at least a few months’ worth of your monthly mortgage payments. For a $310,000 home with a 20% down payment, that could mean setting aside around $6,000. The exact amount will depend on your down payment amount, interest rate, and other loan terms.

For ongoing maintenance and other housing expenses, you’ll need to ask your realtor to make sure you know how much you can expect to pay in property taxes, homeowner insurance, HOA fees, and other costs.

Ultimately, it’s essential to assess your financial situation carefully and consult a reputable mortgage lender to determine how much house you can afford comfortably.

Buy a Home in Houston with Chris Schmidt Today

If you’re considering buying a house in Houston, partnering with a knowledgeable and experienced real estate professional can make all the difference in finding your perfect home. At Your Home Sold Guaranteed Realty - Chris Schmidt Team, Chris Schmidt and our team have been continually ranked as the best realtor in Houston. 

We’ve helped many buyers find homes that match their budget and preferences thanks to our in-depth knowledge of the local housing market and unique buyer guarantees, including our Buy it Back Guarantee.

If you are interested in working with our team to buy a home, call or text today at 713-322-5604. You can also use the form below. Don’t have to wait to find your dream home in Houston!

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