How much does it cost to buy a house in Michigan?

How much money does it cost to buy a house in Michigan?

Are you thinking about buying your first home, but you’re not entirely sure if you can afford it without draining your life's savings? 

In this article, I’m going to break down exactly how much you can expect to pay for your first home in Michigan with real life examples and statistics. Make sure you stay tuned until the end of this video where I’m going to share how you can save LITERALLY thousands on your first home and in some cases walk-away from the closing table with a check made out to you!

If this is your here, my name is Briana Maratta and I’m a realtor that specializes in helping first-time home buyers in Michigan.

I’m going to walk you through a step by step example of what a typical Michigan home can cost you. Keep in mind these numbers are going to be different based on if you choose to spend more or less. 

• Let’s take the average sales price that was reported across Michigan as of July of 2021 according to Michigan realtors which is $245,439. For even number purposes let's call it 245,000 which is a pretty typical number we are seeing buyers spend on their first home. 

• Let’s talk about your down payment first. There are many different down payment options and buyer programs specific for first time home buyers (which I’ll talk about at the very end). You may think you have to put 15-20% down on a home, but that just simply isn't true and was a more common occurrence when your grandparents bought their first home for less than $50K back in the day! 

• The minimum down payment required for a conventional loan is only 3%. so $245,000 x 3% = $7,350.00 is required for your down payment on a $245,000 house. 

• Next, we’ll go over the closing costs. Closing costs are going to vary from lender to lender, so make sure when you’re talking with a local lender you're asking to see a loan estimate breakdown so you can see the exact fees you’re being charged. As a general rule of thumb, closing costs are 2-5% of the purchase price. Let’s be conservative and say it’s 3% of the purchase price so another $7,350.00 for closing costs. This is going to include your tax prorations, title insurance, recording fees, PMI, and lender costs. 

• With down payment and closing costs, you’re looking at $14,700.00 

• Another cost you're going to want to factor in is the home inspection fee. Always, always get a home inspection no matter what! - you can expect a home inspection to cost you anywhere from $300 on the low end if you choose to just get a basic inspection to $1000 if you add on other things like a sewer scope or radon test.

• Another fee you can expect is the home appraisal to have the house appraised by the bank which is typically $500-$600. 

• All in all, you can expect to pay out of pocket a little over $15K out of pocket which is a lot less overwhelming than $245,000!

• Now since you stuck around until the end of this article, I’ll let you in on a secret - since you are a first time home buyer, you can qualify for a program called MSHDA - MI State Housing Development Authority which is a down payment assistance program that can cover your down payment and closing costs up to $10,000 in 236 different MI zip codes! All you need is a 640 credit score and you have to take a homebuyer education class to qualify. The purchase price must be less than $224,500 - but still a great program to utilize for first time home buyers.

Now that you have an idea of what your first house is going to cost you - you’re going to want to know how the whole buying process works as a first time home buyer so you don’t make mistakes that could cost you the perfect house! In the next video, I’ll share with you the home buying process step by step. 

If you feel confident enough to get the home buying process started and want to learn more - send me an email to book a buyer consultation with me and I’d love to connect!