The Average Cost of Buying a Home in the United States.

What is the most affordable Buying a Home way to get into a home?

How much does it cost to buy a new home?

Let us know that The United States How much does it actually cost to buy a new home in the United States? There are factors that can affect the total cost of your potential residence.

Key Takeaways

• The average upfront cost of buying a new home in the United States is $43,874.
• The three most affordable and work-affording cities to own a home on Balance’s Home Affordability Index are St. Louis, Baltimore, and Detroit.
• Los Angeles, San Francisco, and San Diego are the three least affordable cities to have a home in the United States. The Balance’s Home Affordability Index.

The Average Cost to Buy a New Home

The average upfront cost of buying a new home in the United States is $43,874. This cost includes the down payment, closing costs, and the first monthly payment. We have included national averages in the data as a baseline, but these costs often depend on the city and region. For example, Dallas and Tampa have about $705 in first-month costs—not so different—but Tampa residents pay more in closing costs.

Note: We in the United States also calculated the average monthly cost of owning a home at $1,634. To learn more about homeownership costs, how to calculate them, and more, check out the Average Cost of Owning a Home.

The Average National Cost of Purchasing a Home in the United States

The national average cost (including the first monthly payment) of buying a home in the United States is $43,874. 

First Monthly Payment ($1,634)

United States Average: $43,874

Down Payment ($36,140)

First Monthly Payment ($1,634)

Closing Costs ($6,100)

Estimates include a 10% down payment based on the national average sale price as of 04/02/2022 and the latest weighted average interest rates for each metro state or national rate of 30-year, fixed-rate mortgage, and district based on the date of sale. accepts price information Closing costs are based on a national average estimate from Closing Corp.

Chart: Adrian Nesta  Source: Zillow, ClosingCorp, FHA, Freddie Mac via FRED, CFPB

The Average Regional Home Purchase Price 

The average cost to buy and move a new home in the top 21 United States metro areas. (The first monthly payment is included.)

U.S. metro	Down Payment	Closing Costs	First Monthly Payment
San Francisco, CA | $120,807	$109547	$6910	$4350
Los Angeles, CA | $102,725	$92192	$6910	$3623
San Diego, CA | $94,675	$84412	$6910	$3353
Seattle, WA | $91,932	$75784	$13115	$3033
Washington, DC | $81,509	$51688	$27533	$2318
New York, NY | $73,566	$57171	$13490	$2905
Boston, MA | $70,765	$61622	$6313	$2830
Denver, CO | $67,041	$60673	$3937	$2431
Riverside, CA | $65,168	$55933	$6910	$2325
Phoenix, AZ | $52,343	$46630	$3893	$1820
Miami, FL | $51,695	$42834	$6891	$1970
Baltimore, MD | $49,105	$34765	$12674	$1666
Dallas, TX | $45,453	$39414	$4004	$2035
Tampa, FL | $44,748	$36187	$6891	$1670
Philadelphia, PA | $42,521	$30331	$10580	$1610
Atlanta, GA | $41,480	$35953	$3904	$1623
Minneapolis, MN | $41,182	$35484	$4006	$1692
Houston, TX | $38,904	$33108	$4004	$1792
Chicago, IL | $37,815	$30138	$5948	$1729
Detroit, MI | $29,575	$24072	$4256	$1247
St. Louis, MO | $26,930	$23544	$2184	$1202

Down Payment

A down payment is the amount you pay in advance to buy a home. Your down payment can be expressed as a percentage of the total home price, ranging from 0% to 20% or more.

In the United States, a small down payment may be attractive, but paying more initially reduces the cost of the loan. While lenders may allow you to deduct up to 3% for a traditional mortgage, you can save by reducing at least 10% of the cost of the home, which we considered for our calculations here. As you can see from the chart above, a down payment takes up the bulk of the upfront cost, regardless of where the buyer lives.

Note: If you’re a veteran, a first-time home buyer, or someone else who falls into a special category, you may be able to access no-down-payment or down-payment assistance options, but keep in mind that this can mean a higher monthly payment. It is possible

Closing Costs

Most generally, closing costs range from 2% to 5% of the purchase price of the home. Closing costs may include appraisal fees, title insurance, prepaid property taxes, insurance, and interest. Closing costs can also include points, a percentage of your total debt that can be used to reduce your interest rate. But closing costs can vary by location. Washington, DC, Philadelphia, Baltimore, Seattle, and New York stand out for their high closing costs in proportion to the buyer’s down payment.

You can shop around or negotiate some closing costs if you want, so you can compare loan estimates from at least three lenders.

Your first monthly payment, including principal, interest, taxes, and insurance (PITI), is not due along with other advanced payments. Instead, PITI usually occurs on the first day of the second month after closure. Depending on when you close, your first payment could be up to a month or two months after you complete the purchase. We’ve included it here as an upfront cost because it’s an expense you’ll have to cover on the heels of a significant outlay.

Other Costs

Private mortgage insurance, or PMI, will be required if you owe less than 20% on a home. This insurance will safeguard the lender if you don’t make your mortgage payment. PMI costs are usually added to your monthly mortgage payment but may also be required at closing (FHA loans, for example, require an upfront PMI payment). The cost of your PMI insurance is based on how much you are borrowing, your credit score, and how your loan performs in the secondary mortgage market.

A home warranty may also be included with your home purchase. A new home may include a free builder’s warranty, which covers workmanship and materials for specific, permanent features of the home for a limited time. For example, the builder can guarantee that the new home does not have electrical or plumbing system defects for two years or structural defects for five years.

The other type of warranty is a home warranty or an extended warranty. This is not a really true warranty; this is an optional service contract that can take care of repairs to specific features of your home under certain conditions. Most of these typically cost around $500 or more for one year of coverage and are renewable. But it is also the subject of many consumer complaints. Because warranties that don’t usually cover more expensive repairs often have many exclusions and limitations, a copy may be required of the covered item or service call. You may find that home warranties are an unnecessary expense.

Homebuying-Cost Trends

Regional costs overall in the United States as well as in each MSA we reviewed. Buyers are getting no respite from the rapid rise in home prices, whether they are located in San Francisco or Detroit. However, there is a difference in how expensive the purchase turned out to be. For example, purchases in Miami increased by 15.7%, while purchases in Detroit increased by only 4.7%.

(FOX US USA) Home Affordability Index

While having a general idea of how much it costs to live in an area is useful knowledge, affordability is an important part of the overall puzzle. One way to measure a home’s affordability is to calculate the ratio of housing expenses to income the housing expense ratio. A housing expense ratio of less than 30% is considered affordable; a ratio of more than 30% is not considered affordable.

(FOX US USA) Home Affordability Index

We use the United States government’s definition of housing cost burden to determine affordability. A housing expense ratio (total housing costs divided by average family income) of 30% or less is considered affordable. A housing cost ratio of more than 30% is not considered affordable.

DC’s affordability is a product of its very high household income (2nd highest at $9,700 monthly) rather than a low house price (9th highest at $516,575).

Seattle, WA

• Housing Expense Ratio of 37.23%.
• Mortgage + Interest payment of $1998 compared to the U.S. average of $946
• the Real Estate Tax cost of $418 was compared to the U.S. average of $262
• Home Insurance costs $85 compared to the U.S. average of $119
• Homeowners’ insurance costs of $85 compared to the U.S. average of $119
• Maintenance and Improvement costs of $134 compared to the U.S. average of $117
• Mortgage insurance costs $455, compared to $190 on average in the United States.
• The median Household Income of $8299 compared to the U.S. average of $5416

San Francisco, CA

• Housing Expense Ratio of 44.97%.
• Mortgage + Interest payment of $2879 compared to the U.S. average of $946
• Real Estate Tax cost of $646 compared to the U.S. average of $262
• Home Insurance cost of $110 compared to U.S. average of $119
• Maintenance and Improvement costs of $140 compared to U.S. average of $117
• Mortgage Insurance cost of $657 compared to U.S. average of $190
• Median Household Income of $9855 compared to U.S. average of $5416

Los Angeles, CA

• Housing Expense Ratio of 52.67%
• Mortgage + Interest payment of $2430 compared to the U.S. average of $946
• Real Estate Tax cost of $459 compared to the U.S. average of $262
• Home Insurance cost of $110 compared to U.S. average of $119
• Maintenance and Improvement costs of $140 compared to U.S. average of $117
• Mortgage Insurance cost of $553 compared to U.S. average of $190
• Median Household Income of $7009 compared to U.S. average of $5416

Riverside, CA

• Housing Expense Ratio of 36.65%.
• Mortgage + Interest payment of $1474 compared to the U.S. average of $946
• Real Estate Tax cost of $327 compared to the U.S. average of $262.
• Home Insurance cost of $110 compared to U.S. average of $119
• Maintenance and Improvement costs of $120 compared to U.S. average of $117
• Mortgage Insurance cost of $336 compared to U.S. average of $190
• Median Household Income of $6459 compared to U.S. average of $5416

San Diego, CA

• Housing Expense Ratio of 44.48%.
• Mortgage + Interest payment of $2224 compared to the U.S. average of $946
• Real Estate Tax cost of $453 compared to the U.S. average of $262
• Home Insurance cost of $110 compared to U.S. average of $119
• Maintenance and Improvement costs of $123 compared to U.S. average of $117
• Mortgage Insurance cost of $506 compared to U.S. average of $190
• Median Household Income of $7681 compared to U.S. average of $5416

Phoenix, AZ

• Housing Expense Ratio of 29.63%
• Mortgage + Interest payment of $1228 compared to the U.S. average of $946
• Real Estate Tax cost of $156 compared to the U.S. average of $262
• Home Insurance cost of $82 compared to U.S. average of $119
• Maintenance and Improvement costs of $109 compared to U.S. average of $117
• Mortgage Insurance cost of $280 compared to U.S. average of $190
• Median Household Income of $6262 compared to U.S. average of $5416

Denver, CO

• Housing Expense Ratio of 32.42%.
• Mortgage + Interest payment of $1600 compared to the U.S. average of $946
• Real Estate Tax cost of $216 compared to the U.S. average of $262
• Home Insurance cost of $155 compared to U.S. average of $119
• Maintenance and Improvement costs of $141 compared to U.S. average of $117
• Mortgage Insurance cost of $364 compared to U.S. average of $190
• Median Household Income of $7637 compared to U.S. average of $5416

Minneapolis, MN

• Housing Expense Ratio of 22.46%.
• Mortgage + Interest payment of $934 compared to the U.S. average of $946
• Real Estate Tax cost of $297 compared to the U.S. average of $262
• Home Insurance cost of $135 compared to U.S. average of $119
• Maintenance and Improvement costs of $140 compared to U.S. average of $117
• Mortgage Insurance cost of $213 compared to U.S. average of $190
• Median Household Income of $7655 compared to U.S. average of $5416

St. Louis, MO

• Housing Expense Ratio of 20.21%.
• Mortgage + Interest payment of $622 compared to the U.S. average of $946
• Real Estate Tax cost of $236 compared to the U.S. average of $262
• Home Insurance cost of $122 compared to U.S. average of $119
• Maintenance and Improvement costs of $98 compared to U.S. average of $117
• Mortgage Insurance cost of $141 compared to U.S. average of $190
• Median Household Income of $6031 compared to U.S. average of $5416

Dallas, TX

• Housing Expense Ratio of 30.17%.
• Mortgage + Interest payment of $1040 compared to the U.S. average of $946
• Real Estate Tax cost of $461 compared to the U.S. average of $262
• Home Insurance cost of $186 compared to U.S. average of $119
• Maintenance and Improvement costs of $141 compared to U.S. average of $117
• Mortgage Insurance cost of $236 compared to U.S. average of $190
• Median Household Income of $6842 compared to U.S. average of $5416

Houston, TX

• Housing Expense Ratio of 28.76%.
• Mortgage + Interest payment of $875 compared to the U.S. average of $946
• Real Estate Tax cost of $420 compared to the U.S. average of $262
• Home Insurance cost of $186 compared to U.S. average of $119
• Maintenance and Improvement costs of $137 compared to U.S. average of $117
• Mortgage Insurance cost of $199 compared to U.S. average of $190
• Median Household Income of $6317 compared to U.S. average of $541

Detroit, MI

• Housing Expense Ratio of 22.22%.
• Mortgage + Interest payment of $636 compared to the U.S. average of $946
• Real Estate Tax cost of $282 compared to the U.S. average of $262
• Home Insurance cost of $93 compared to U.S. average of $119
• Maintenance and Improvement costs of $110 compared to U.S. average of $117
• Mortgage Insurance cost of $144 compared to U.S. average of $190
• Median Household Income of $5694 compared to U.S. average of $5416

Boston, MA

• Housing Expense Ratio of 33.8%.
• Mortgage + Interest payment of $1624 compared to the U.S. average of $946
• Real Estate Tax cost of $526 compared to the U.S. average of $262
• Home Insurance cost of $149 compared to U.S. average of $119
• Maintenance and Improvement costs of $207 compared to U.S. average of $117
• Mortgage Insurance cost of $370 compared to U.S. average of $190
• Median Household Income of $8509 compared to U.S. average of $5416

New York, NY

• Housing Expense Ratio of 40.04%.
• Mortgage + Interest payment of $1506 compared to the U.S. average of $946
• Real Estate Tax cost of $792 compared to the U.S. average of $262
• Home Insurance cost of $125 compared to U.S. average of $119
• Maintenance and Improvement costs of $182 compared to U.S. average of $117
• Mortgage Insurance cost of $343 compared to U.S. average of $190
• Median Household Income of $7363 compared to U.S. average of $5416

Philadelphia, PA

• Housing Expense Ratio of 24.1%.
• Mortgage + Interest payment of $799 compared to the U.S. average of $946
• Real Estate Tax cost of $424 compared to the U.S. average of $262
• Home Insurance cost of $88 compared to U.S. average of $119
• Maintenance and Improvement costs of $140 compared to U.S. average of $117
• Mortgage Insurance cost of $182 compared to U.S. average of $190
• Median Household Income of $6777 compared to U.S. average of $5416

Baltimore, MD

• Housing Expense Ratio of 21.96%.
• Mortgage + Interest payment of $915 compared to the U.S. average of $946
• Real Estate Tax cost of $318 compared to the U.S. average of $262
• Home Insurance cost of $106 compared to U.S. average of $119
• Maintenance and Improvement costs of $144 compared to U.S. average of $117
• Mortgage Insurance cost of $209 compared to U.S. average of $190
• Median Household Income of $7705 compared to U.S. average of $5416

Washington, DC

• Housing Expense Ratio of 24.3%.
• Mortgage + Interest payment of $1360 compared to the U.S. average of $946
• Real Estate Tax cost of $400 compared to the U.S. average of $262
• Home Insurance cost of $121 compared to U.S. average of $119
• Maintenance and Improvement costs of $166 compared to U.S. average of $117
• Mortgage Insurance cost of $310 compared to U.S. average of $190
• Median Household Income of $9700 compared to U.S. average of $5416

Atlanta, GA

• Housing Expense Ratio of 24.52%.
• Mortgage + Interest payment of $950 compared to the U.S. average of $946
• Real Estate Tax cost of $221 compared to the U.S. average of $262
• Home Insurance cost of $129 compared to U.S. average of $119
• Maintenance and Improvement costs of $134 compared to U.S. average of $117
• Mortgage Insurance cost of $216 compared to U.S. average of $190
• Median Household Income of $6729 compared to U.S. average of $5416

Tampa, FL

• Housing Expense Ratio of 31.17%.
• Mortgage + Interest payment of $953 compared to the U.S. average of $946
• Real Estate Tax cost of $199 compared to the U.S. average of $262
• Home Insurance cost of $188 compared to U.S. average of $119
• Maintenance and Improvement costs of $140 compared to U.S. average of $117
• Mortgage Insurance cost of $217 compared to U.S. average of $190
• Median Household Income of $5445 compared to U.S. average of $5416

Miami, FL

• Housing Expense Ratio of 36.56%.
• Mortgage + Interest payment of $1128 compared to the U.S. average of $946
• Real Estate Tax cost of $288 compared to the U.S. average of $262
• Home Insurance cost of $188 compared to U.S. average of $119
• Maintenance and Improvement costs of $141 compared to U.S. average of $117
• Mortgage Insurance cost of $257 compared to U.S. average of $190
• Median Household Income of $5476 compared to U.S. average of $5416

Chicago, IL

• Housing Expense Ratio of 25.6%.
• Mortgage + Interest payment of $794 compared to the U.S. average of $946
• Real Estate Tax cost of $529 compared to the U.S. average of $262
• Home Insurance cost of $99 compared to U.S. average of $119
• Maintenance and Improvement costs of $149 compared to U.S. average of $117
• Mortgage Insurance cost of $181 compared to U.S. average of $190
• Median Household Income of $6844 compared to U.S. average of $5416

Source: Adrian Nesta  Source: Census ACS, Census AHS, Zillow, Freddie Mac via FRED, CFPB

The national homeowner expense ratio is 30.2%. This means that 30.2% of the average American homeowner’s income goes to housing costs. The color scale indicates where a city ranks on the affordability index, with dark-red Los Angeles being significantly less affordable than dark-green St. Louis as the cheapest place to live.

Homeownership as a percentage of monthly income 

A home is considered affordable if the monthly cost of ownership is 30% or less of the monthly income. Here’s how the 21 largest U.S. metros stack up.

Los Angeles, CA	52.7%
San Francisco, CA	45.0%
San Diego, CA	44.5%
New York, NY	40.0%
Seattle, WA	37.2%
Riverside, CA	36.7%
Miami, FL	36.6%
Boston, MA	33.8%
Denver, CO	32.4%
Tampa, FL	31.2%
U.S. average	30.2%
Phoenix, AZ	29.6%
Houston, TX	28.8%
Chicago, IL	25.6%
Atlanta, GA	24.5%
Washington, DC	24.3%
Philadelphia, PA	24.1%
Minneapolis, MN	22.5%
Detroit, MI	22.2%
Baltimore, MD	22.0%
St. Louis, MO	20.2%

Note: (FOX US USA) relies on regional data for both the cost of housing and income. So while some consider Washington, D.C., real estate to be “affordable,” the relatively high regional incomes in our data suggest that it is within the reach of many who live there (at least for the well-heeled). In contrast, the relatively low incomes of Los Angeles in our data highlight the housing affordability crisis in that area.

Methodology

The data for this project was derived from a number of different sources.

• Home prices were sourced from Zillow’s weekly median list price by MSA and US, smooth and seasonally adjusted for all homes.
• Mortgage interest rates for each state were sourced from the CFPB and nationally were sourced from Freddie Mac via FRED.
•  The median real estate taxes and median household income for each MSA were sourced from the U.S. Census Bureau’s American Communities Survey five-year 2020 estimates.
• Home maintenance and improvement costs were sourced from the US Census Bureau’s American Housing Survey from 2019.
• Average closing costs for each state were sourced from ClosingCorp’s Purchase Mortgage Closing Cost Report for 2021.
• Insurance premiums for each state were sourced from the National Association of Insurance Commissioners’ Dwelling, Fire, Homeowners Owner-Occupied, and Homeowners Tenant and Condominium/Cooperative Unit Owner’s Insurance Report: Data for 2019.
• The private mortgage insurance rate was sourced from the Urban Institute’s Housing Finance at a Glance monthly chartbook from August 2021.
•  All figures have been normalized for inflation. Inflation adjustment data was sourced from the U.S. Bureau of Labor Statistics’ Consumer Price Index.

Because of the inclusion of estimates and statewide averages, the pricing points for the individual components and total costs for each MSA should not be interpreted as exact figures, but should be used to determine pricing between regions and national data. A comparison should be made.

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