How to Buy a House in Florida: A Homebuyer’s Guide
Updated: April 24, 2024
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The average Florida home is worth about $406K, up about 25% in the last year and higher than the national average of $365K. Cost is a primary consideration when purchasing a home, but you must also consider other factors, such as mortgage lending terms.
To help you navigate the process and avoid excessive debt, MoneyGeek outlined the steps to buying a home in Florida. As part of our analysis, we cover mortgage rates, location selection and home inspections.
Choose an Ideal Location
Location is important when determining how much a Florida house will cost. According to 2022 data, the median home price in Brooksville is $329,737, whereas the average home price in Masaryktown is $241,288.
When choosing the best place to buy a house in Florida, you’ll need to consider other factors besides cost, such as lifestyle, neighborhood amenities and the area’s cost of living.
Calculate Mortgage Rates
You should understand the mortgage rates available to you when looking to buy a home in Florida. Consider your profile and needs when deciding which mortgage option is best for you. Different mortgage options offer different rates.
You may qualify for a larger mortgage and lower interest rate based on your income, credit history and debt-to-income ratio. You can also compare lenders to find the best mortgage rates for your profile.
Prepare Down Payment Requirements
The down payment requirements for different types of mortgages vary. The typical down payment requirement is 20%, but some loans have down payment requirements as low as 3.5%. Some home loans, like VA and USDA home loans, don’t require a down payment.
Get Pre-Approved for a Mortgage
Getting pre-approved for a mortgage is the next step after choosing a lender. Some sellers require a mortgage pre-approval before they show you their properties. Pre-approval requires a hard credit check and is a commitment from the lender to lend you a specific amount.
Pre-approval differs from pre-qualification, which shows you qualify for a loan but is not a commitment from the lender.
Conduct a Home Inspection
Home inspections are an important part of the purchasing process. A home inspector can provide objective information about the home’s current condition and whether repairs are needed. In most cases, the buyer pays for the home inspection.
Close Your Mortgage Loan
The lender will send you a mortgage offer once your ideal home is appraised. Make sure you go over the details of the offer. During this stage, mortgage loan applicants must pay application fees and other closing costs.
Florida Homebuying Details
Florida's average home price and cost of living are higher than the national average. Therefore, investing in a home that will give you good value for your money is essential.
Buying a home in Florida is possible through both conventional or government-backed mortgages. Various down payment assistance programs are available in Florida, such as The Florida Assist (FL Assist) and The Florida Homeownership Loan Program (FL HLP) Second Mortgage.
In Florida, the median home price is $406K, although prices can vary depending on where you choose to live. You may save money by shopping around and comparing costs between neighborhoods.
Make sure you stay within the conforming loan limits in Florida when choosing a mortgage loan. In contrast to conventional loans, FHA loans vary from county to county.
Consider the cost of living in your ideal neighborhood when calculating the total cost of purchasing your home. Choosing an area close to great amenities can increase the cost of your property, but it may also boost its desirability and quality of your life. For instance, local amenities, such as parks, provide residents with a place to relax, engage in recreational activities, and be social, which promotes a healthier mental and physical state.
Frequently Asked Questions About Buying a Home in Florida
MoneyGeek answers questions about Florida home buying.
If you're considering buying a home in Florida, you should ask yourself the following questions:
- What is the best location for your profile and budget?
- Does the property's neighborhood offer a high quality of life, cultural diversity and other important aspects?
- Is there a property tax on the house? How much?
No matter where you live, owning a home comes with many financial and personal obligations. Make sure you are financially prepared before making a home purchase.
A Florida home is worth more than the average home in the United States. Since costs increased 25% in the past year, you’ll likely make a good investment by purchasing a home now if you have the financial capacity.
According to the United States Census Bureau's 2020 report, Florida has a household income of $61,224. The cost of living in the neighborhood should be lower than your income before you purchase a house in the state.
Property taxes in the state average $1,290 per year, or 0.91% of the value of owner-occupied housing.
Some of the most affordable neighborhoods in Florida are Jacksonville, Cape Coral, Gainesville, Dade City and Dunedin.
sources
- Consumerfinance.gov. "What Is a Closing Disclosure?." Accessed October 6, 2022.
- Florida Housing Finance Corporation. "Homebuyer Overview." Accessed November 22, 2022.
- Miami Dade County. "Inspection Guidelines." Accessed November 22, 2022.
- Missouri Economic Research and Information Center. "Cost of Living Data Series." Accessed October 6, 2022.
- U.S. Department of Agriculture. "Single Family Housing Direct Home Loans | Rural Development." Accessed October 6, 2022.
- USDA. "Is Mortgage Insurance Required for a Rural Housing Service Single-Family Loan?." Accessed October 6, 2022.
- Zillow. "Florida Home Values." Accessed October 6, 2022.