Save for down payment | Find a real estate agent | Get preapproved for a mortgage | Choose your neighborhood | Go house hunting | Make an offer | Inspections and appraisal | Final walkthrough and closing
Buying a house in Washington D.C. is an exciting milestone, but the process can take some time. Several factors, like your financial situation, market conditions, and the local economy can affect both how long it takes you to find a home and how much it costs you.
For example, homes in Washington D.C. are hitting the market at $621,250 and selling within 42 days — 19 days faster than the state average! — so you'll need to move quickly if you want to beat out the competition.
The more you know about the home buying process and Washington D.C.'s current real estate trends, the more prepared you'll be to navigate this complicated process as quickly and smoothly as possible.
No matter where you are in your home buying journey, Clever can connect you with local real estate pros who will help you purchase your Washington D.C. dream home!
The best part? When you buy with a Clever real estate agent, you could earn a cash-back refund worth up to 0.5% of the home price. On a qualifying $300,000 purchase, you'd get $1,500. That's real money back in your pocket!
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 Washington D.C. want you to contribute 20% of the purchase price as a down payment. That would be $110,559 for a $552,793 home — the typical home value in Washington D.C..
However, you have options to lower your down payment amount.
Government backed loans, like VA and FHA loans, allow you to contribute 0% and 3.5% of your home's purchase price respectively. Even conventional loans allow for down payments as low as 3-5% (though the minimum varies by lender).
Minimum down payment (%)
Down payment ($)
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 5.56% 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.
Washington D.C. down payment assistance programs
There are a few down payment assistance (DPA) programs designed with Washington, D.C. residents in mind. If you qualify, these programs can provide you with a grant or second mortgage to pay for a down payment or cover closing costs.
Here are a few regional resources that you may qualify for:
DCHFA Home Purchase Assistance Program
The D.C. Housing Finance Authority’s (DCHFA) Home Purchase Assistance Program offers an interest-free loan of up to $80,000 to low-income buyers. Some borrowers may be eligible for an additional $4,000 to pay for closing costs. This loan must be repaid once the home is resold or refinanced.
Moderate-income homebuyers can qualify for this program, but they're required to start paying it off after five years.
DCHFA DC Open Doors Program
The DCHFA’s DC Open Doors Program offers a deferred 0% interest loan that can completely cover the minimum down payment of a home. The program is open to first-time and repeat homebuyers.
To qualify, the borrower must have a credit score of at least 640 and earn less than $151,200 annually.
U.S. Department of Housing and Urban Development
Additional programs for D.C. homebuyers can be found through HUD.
Step 2: Find a great real estate agent in Washington D.C.
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 Washington D.C..
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
Clever matches you with multiple agents in your area so you can interview, compare, and choose the best one to help you buy your next home.
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 Washington D.C. 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 Washington D.C. home.
Get Pre-approved Today!
Get matched with a lender who can tell you how much house you can afford. To get started, where do you plan on buying?
Step 4: Choose the right location
Currently, the typical home value in Washington D.C. is $552,793, 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 Washington:
Home value appreciation in Washington
Step 5: Start house hunting in Washington D.C.
Searching for homes in Washington D.C. 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 Washington D.C. can have a big impact on your number of options. For example, in Washington D.C., September 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 Washington D.C.. Historically, there are 55.6% fewer homes for sale than during Washington D.C.'s peak season.
Housing inventory in Washington D.C. by season
New listings per month
Based on data from Realtor.com (September 2022)
Step 6: Make an offer
Once you find a Washington D.C. 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 Washington D.C., homes stay on the market for 39 days before going under contract. However, every market goes through seasonal changes. During busier months, homes get snatched up more quickly than others.
Historically, Washington D.C. homes sell fastest in April, where the average property is only on the market for 32 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 19 days longer than Washington D.C.'s annual average.
Average time homes spend on market in Washington D.C.
Based on data from Realtor.com (September 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 Washington D.C.
Having your Washington D.C. 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.
Washington D.C.-specific inspections
Sellers in Washington, D.C. are required to disclose known property issues to interested buyers, but some problems may go unnoticed. Buyers are strongly encouraged to take extra precautions by having a few specialized tests completed in addition to a general home inspection.
Although these inspections aren't required, they can reveal potential health and safety hazards that might devalue a home. Before closing on a D.C. home, think about conducting the following tests:
- Radon testing: Exposure to high levels of radon can cause long-term health complications, so consider doing a test if the seller hasn't performed a test within the past year.
You can order a free radon test kit from the D.C. Department of Energy and Environment here.
- Pest inspection: Not all lenders require buyers to have a pest inspection completed before closing, but it's a smart move regardless. Termites and other household pests can pose health and safety hazards that could be easily mitigated with early detection.
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!
To finish closing on your D.C. home, you'll need to complete the necessary paperwork and settle your closing costs.
On the closing date, you'll meet at the title company to review and sign several documents. It's highly recommended to study the paperwork ahead of time to make sure you fully understand what you're signing.
A few common real estate forms will include:
- The mortgage note
- The deed
- The disclosure statements
After finishing the paperwork, you'll have to pay the closing costs. For homebuyers, closing costs can usually be divided into four categories:
- Lender fees: Fees paid to your lender for originating and underwriting your loan.
- Title and escrow charges: Charges paid to the title company for their research, documentation, title transfer, and other services.
- Prepaid costs: Ongoing costs of homeownership, like property taxes and homeownership. Some lenders require borrowers to pay these fees up front when buying a house.
- Other closing fees: Miscellaneous fees that vary for each buyer. These expenses may cover pest inspections, flood insurance, real estate attorney fees, and other services.
Buyers in Washington D.C. typically pay 3–5% of the purchase price in closing costs. For a $552,800.00 home — the typical home value in Washington D.C. — that's between $16,584 and $27,640!
» LEARN MORE: Closing costs for buyers in Washington D.C.
Frequently asked questions
- Save for down payment
- Get pre-approved for a mortgage
- Choose your preferred Washington D.C. neighborhoods
- Partner with the right real estate agent in Washington D.C.
- Go house hunting
- Make a strong offer
- Inspections and appraisals
- Do a final walkthrough and close
Yes! The Washington State Housing Finance Commission offers its House Key Opportunity Program to first-time buyers. Eligible participants can get competitive interest rates if they have an FHA, VA, or USDA loan. Buyers with conventional loans may be eligible for a rate discount if they earn less than 80% of their area's median income.
To qualify, you need to be within the household income and purchase price limits set for your county. If you're accepted, you'll have to complete a homebuyer education course.