Now that the housing market is finally calming down after the pandemic, buyers are facing a new challenge: Soaring mortgage rates.
In Virginia, the average 30-year fixed mortgage rate is 5.52% — up from 2021's historic lows. This raises the average monthly mortgage payment to $1,743 (assuming a 20% down payment at the median home value).
But buying a home in Virginia is still possible, even for first-time home buyers. Many markets are seeing frequent price drops and fewer offers, giving motivated buyers the upper hand in negotiating for the best price.
In this guide, you’ll learn how to buy a house in Virginia with confidence no matter what the market brings. Learn why you can trust our advice.
Whether you're actively house hunting or just starting to browse homes on Zillow, it's never too early to find a great local realtor to guide you on your search. An experienced agent can help you navigate a tricky housing market, explore your financial options, and negotiate the best deal possible.
Best of all, hiring a real estate agent comes at no extra cost to you — since the seller typically pays both their listing agent and your buyer's agent.
Ready to find a great local realtor, but not sure where to start? The best (and easiest!) option is to try a free agent matching service like Clever Real Estate. Answer a few simple questions about your home buying goals, and Clever will match you with hand-picked agents from Keller Williams, RE/MAX, and other top brokerages in your area. Find a top local agent and make your home buying dreams a reality today!
Step 1: Save for a down payment
Your down payment is the first part of your home's purchase price that you pay at closing. Your mortgage lender will pay the remaining balance.
Typically, mortgage lenders in Virginia want you to contribute 20% of the purchase price as a down payment. That would be $76,592 for a $382,958 home — the typical home value in Virginia.
However, you have options to lower your down payment amount.
Government backed loans, like VA and FHA loans, allow you to contribute 0% and 3.5% of your home's purchase price respectively. Even conventional loans allow for down payments as low as 3-5% (though the minimum varies by lender).
Minimum down payment (%)
Down payment ($)
Based on typical home values from Zillow (August 2022)
But making a down payment of less than 20% comes with some risks.
First, because you're borrowing more money, you'll have a higher monthly payment and pay more in interest over the life of your loan.
Based on home values from Zillow (August 2022) and a 5.52% interest rate for a 30-year loan.
Second, you may have to purchase mortgage insurance.
Conventional loans require private mortgage insurance (PMI) until your loan balance reaches 80% of the purchase price. FHA loans, on the other hand, require a mortgage insurance premium (MIP) for the life of your loans.
Mortgage insurance costs around 1% of your mortgage balance annually. However, rates vary based on your down payment and credit score. Typically, your mortgage insurance payment is added to your mortgage payment each month.
VA loans don't charge mortgage insurance. Instead, you'll pay a VA loan funding fee at closing, which can range from 1.4% to 3.6% of the purchase price.
Virginia down payment assistance programs
The state of Virginia offers several down payment assistance (DPA) programs to eligible first-time and low-income homebuyers. If you qualify for one of these programs, you could receive a grant or second mortgage to pay for a down payment or closing costs.
Here are a few DPA resources for you to consider:
Virginia Housing DPA Grant
Virginia Housing offers first-time homebuyers a grant of up to 2.5% of the home's purchase price. The grant can only be used along with a Virginia Housing loan, and home purchase price and household income limits apply. You can review all the eligibility requirements here.
Virginia Housing Plus Second Mortgage
Virginia Housing offers its Virginia Housing Plus Second Mortgage program to buyers who meet credit score requirements and don't exceed household income limits. Participants can receive a loan of up to 5% of their home's purchase price, although this may vary based on a borrower's first mortgage.
DHCD DPA Program
The Virginia Department of Housing and Community Development (DHCD) can offer financial assistance for first-time homebuyers of up to 15% of the home's sales price. Additionally, up to $2,500 may be awarded to assist with closing costs for qualified buyers.
Eligible participants are required to complete a homebuyer education course, attend housing counseling, and contribute a minimum of 1% towards the home purchase. Maximum household income and property purchase limits also apply.
U.S. Department of Housing and Urban Development
HUD’s list of alternative DPA programs in Virginia can be found here.
Step 2: Find a great real estate agent in Virginia
Your real estate agent will be your main ally during the home buying process. Besides finding and showing you properties, your agent will help you make offers, negotiate contracts, and navigate the closing process. Plus, they can recommend other service providers like title companies and inspectors to help you buy your home in Virginia.
Don't rush into choosing an agent. Instead, take the time to research and interview multiple real estate agents who have experience in the neighborhoods you're interested in. You should pay attention to a realtor's:
- Years of experience
- Number of transactions in the last year (the more the better!)
- Experience in your price range
- Overall review score
- Individual reviews and complaints
Step 3: Get preapproved for a mortgage
A mortgage preapproval letter is an offer to lend you up to a certain amount of money to purchase a home. It shows sellers that you are a serious buyer who is financially qualified to make an offer on a home.
Most sellers in Virginia will require preapproval before showing you their home.
You don't have to decide on one lender right now. In fact, you should compare interest rates and preapproval amounts from several lenders to make sure you're getting the absolute best terms when you buy your Virginia home.
Step 4: Choose the right location
Currently, the typical home value in Virginia is $382,958, but don't worry if that doesn't perfectly match your budget. Home prices vary dramatically from city to city and even from neighborhood to neighborhood!
Also, look at past home value trends. This will give you an idea of how much your home's value could go up over the next few years.
To give you an idea of how appreciation could impact what your house is worth in the future, consider these examples from three neighborhoods in Virginia Beach:
Home value appreciation in Virginia Beach
Step 5: Start house hunting in Virginia
Searching for homes in Virginia is the fun part of the home buying process! You'll get to look at a variety of homes and discover what you really want in a home.
Make a list of everything you want in a home and prioritize them. At the top of the list should be the items that are most important to you. This will help you separate your "must-haves" from your "nice-to-haves."
Your agent can help you understand if your wants are realistic for your budget and favorite neighborhoods or if you need to rethink what you're looking for.
Look at current housing inventory
The timing of your house hunt in Virginia can have a big impact on your number of options. For example, in Virginia, May has historically seen the most homes for sale. Searching in this season could give you more options and a greater likelihood of finding your dream home.
On the other hand, December gives you the fewest choices in Virginia. Historically, there are 52.5% fewer homes for sale than during Virginia's peak season.
Housing inventory in Virginia by season
New listings per month
Based on data from Realtor.com (October 2022)
Step 6: Make an offer
Once you find a Virginia house you love, it's time to make an offer. Your real estate agent will help you write a compelling offer that gives you the best shot of convincing the homeowner to sell to you.
Currently, in Virginia, homes stay on the market for 64 days before going under contract. However, every market goes through seasonal changes. During busier months, homes get snatched up more quickly than others.
Historically, Virginia homes sell fastest in April, where the average property is only on the market for 49 days. If your home search falls around this time, you should be prepared to move quickly and potentially make offers on several homes before yours is accepted.
On the other hand, if you buy in January, you have a bit more time to search. Homes typically stay on the market 20 days longer than Virginia's annual average.
Average time homes spend on market in Virginia
Based on data from Realtor.com (October 2022)
» LEARN MORE: What should an offer include?
Step 7: Inspections and appraisals
Inspections and appraisals are an opportunity for you to better evaluate the home's condition and value before officially purchasing it. You may have an opportunity after this step to renegotiate the terms of your contract with the seller if something unexpected pops up.
Home inspections in Virginia
Having your Virginia home inspected by a licensed inspector gives you peace of mind about the condition of the property before you commit thousands of dollars to purchase it.
Your inspector should check out the following parts of the property:
- Electrical system
- HVAC system
If the home has a septic system, you should also pay for a septic inspection to make sure it doesn't have any problems that wouldn't be covered in a typical home inspection.
Virginia is a “buyer beware” state, so homebuyers are strongly advised to take extra precautions before closing on a property. In addition to a general home inspection, consider having these important tests conducted as well:
- Radon testing: Several areas in Virginia are prone to high radon levels, which can pose health risks to inhabitants. If the seller hasn't had a radon test done within the past year, you can order an inexpensive radon test kit from the Virginia Department of Health.
- Pest inspection: Although not all lenders require buyers to have a pest inspection done, it's wise to get one completed anyway. Termites and other pests can cause serious property damage if infestations aren't treated promptly.
Appraisals determine the value of the property. If you're using a mortgage to buy your new home, your lender will order an appraisal to make sure the home is worth the money that it's loaning you.
Step 8: Close on your new home!
Before you can become the official owner of your Virginia home, you'll need to meet at the title company on closing day. Here, you'll spend a few hours completing paperwork and settling your closing costs.
Plan to spend about an hour reviewing and signing legal documents to finalize the title transfer. Some important forms you'll need to complete will include:
- Your final loan application
- The deed
- The mortgage promissory note
- The disclosure statements
Once you finish the paperwork, you'll need to pay your closing costs. The title company will collect the total amount you owe and then handle the distribution of funds. For homebuyers, these expenses can be broken down into four distinct categories:
- Lender fees: Fees your lender charges for originating and underwriting your loan. Other expenses associated with your loan might apply as well, such as appraisal fees and survey fees.
- Title and escrow charges: Fees the title company charges for conducting the title search and facilitating the closing. Buyers and sellers often agree to split this cost.
- Prepaid costs: Ongoing costs of owning a home, like homeowners insurance and property taxes. Mortgage lenders frequently require borrowers to pay for these expenses in advance.
- Other closing costs: Miscellaneous expenses that vary for each homebuyer. A few common expenses include real estate attorney fees, pest inspection fees, and natural disaster certification fees.
Buyers in Virginia typically pay 3–5% of the purchase price in closing costs. For a $383,000 home — the typical home value in Virginia — that's between $11,490 and $19,150!
Frequently asked questions
In Virginia it's required for a real estate attorney to be part of every home sale. While your agent can make recommendations, remember you get to make the final decision. Interview lawyers before hiring them to make sure they have the experience you need.
- Save for down payment
- Get pre-approved for a mortgage
- Choose your preferred Virginia neighborhoods
- Partner with the right real estate agent in Virginia
- Go house hunting
- Make a strong offer
- Inspections and appraisals
- Do a final walkthrough and close
Yes! The VHDA (Virginia Housing Development Authority) offers eligible buyers up to 2.5% of their home purchase price through a Down Payment Assistance Grant.
To qualify, the borrower's credit score must be at least 620 with an FHA loan, 640 for a VHDA Conventional loan, or 660 for the VHDA Conventional No MI loan. Household income limits also apply and vary by county.
Federal Reserve. "Housing Market Tightness During COVID-19: Increased Demand or Reduced Supply?." Accessed October 11, 2022. Updated July 08, 2021.
Consumer Protection Financial Bureau. "The Fed is raising interest rates. What does that mean for borrowers and savers?." Accessed October 11, 2022. Updated March 17, 2022.