How to Buy a House in Massachusetts: A Homebuyer’s Guide
Updated: September 28, 2023
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The average home value in Massachusetts is about $581K, a 9% increase from the previous year. This value exceeds the national average of $357K, making the state one of the priciest places to purchase a home in the U.S.
Actual rates vary greatly depending on the city or town. The average monthly mortgage in Massachusetts costs about $1,442, and the average real estate tax rate is 1.23%. Property tax per year is approximately $2,667.
This guide outlines the homebuying process in the state to help you find a deal that suits your financial objectives.
Choose an Ideal Location
Your ideal home location will depend on factors like the cost of living, social amenities, culture and proximity to green areas. When researching the cheapest places to buy a house in Massachusetts, consider your lifestyle in addition to the home’s cost.
Calculate Mortgage Rates
Mortgage loan rates vary depending on the lender, loan terms and the borrower’s profile. When comparing offers from different lenders, you may need to balance these factors to secure the right option for your situation.
Prepare Down Payment Requirements
When buying a home, you typically need to make a down payment — the first payment against the purchase cost. Higher down payments generally result in reduced interest rates and monthly premiums and vice versa. Percentages differ based on the mortgage option you choose.
Get Pre-Approved for a Mortgage
The next step after selecting a suitable lender is to seek pre-approval for a mortgage loan. Pre-approval assures the sellers you can afford their home, and many require pre-approval before showing you a property.
Know that pre-approval differs from pre-qualification. Pre-approval confirms your creditworthiness before you identify a home to purchase. Meanwhile, pre-qualification estimates the amount you can borrow as a mortgage based on your profile. Pre-qualification is not a commitment from the lender, whereas pre-approval is.
Conduct a Home Inspection
A home inspection provides a third-party review of your chosen property. A thorough inspection helps you understand the home’s general condition, eliminating any unexpected costs, and can help you negotiate the home’s price.
Close Your Mortgage Loan
If you are happy with the terms of your loan, you can proceed to closing. This is the final phase of your mortgage application, which also entails paying appraisal, document preparation and credit report charges. You may also need to pay inspection costs and any legal fees.
Massachusetts Homebuying Details
Although we outlined a standard home buying process that entails selecting an ideal location, comparing mortgage rates and choosing a suitable lender, you may find other steps specific to the Massachusetts housing market.
If you are still unsure of where to start, you consult a real estate agent or mortgage lender. You can also explore homeowner assistance programs to find help with your down payment.
While estimating your mortgage payment amounts in Massachusetts, consider annual property taxes, as these will be part of the long-term payments for the home. Costs vary depending on where you live within the state.
Home inspections are vital in Massachusetts since sellers are not legally bound to complete a lengthy disclosure form. A professional home inspector can help you flag significant repairs.
Home buyers may take advantage of MassHousing Down Payment Assistance, Boston Home Center DPA Program and other home assistance programs if they need help with the down payment.
Frequently Asked Questions About Buying a Home in Massachusetts
To help you with the homebuying process in Massachusetts, MoneyGeek provided answers to the following frequently asked questions.
Some vital questions to ask yourself before buying a home in Massachusetts include:
- Which location suits your budget and unique situation?
- Which mortgage loan type is ideal for your property of choice?
- How much down payment can you raise, and do you qualify for a homebuyer assistance program?
- How does the mortgage affect your financial well-being?
Buying a home in Massachusetts may be a significant milestone, especially if you find a property that suits your needs. However, the value of a home in the state is very high compared with the national average.
The average home value in Massachusetts has increased by approximately 9% within a year, so it’s wise to buy a house in the state because its value is likely to appreciate in the future.
The income amount required is based on the type of property and the type of mortgage you choose. Typically, you will need enough funds to pay the down payment, which doesn’t exceed 20%, plus mortgage application fees.
Massachusetts collects an average of $3,511 per year in property taxes.
According to Zillow, Bellingham has the lowest average home value in Massachusetts, followed by Hopedale. However, the cheapest cities may lack important amenities like good schools and hospitals.
sources
- Zillow. "United States Home Prices & Home Values." Accessed October 20, 2022.
- Zillow. "Massachusetts Home Prices & Home Values." Accessed October 20, 2022.
- U.S. Department of Agriculture. "Single Family Housing Direct Loans in Massachusetts." Accessed October 20, 2022.
- Zillow. "Compare Today’s Mortgage Rates in Massachusetts." Accessed October 20, 2022.
- Mass.gov. "The Homebuying Process in Massachusetts." Accessed October 20, 2022.
- Realtor. "How Long is Mortgage Pre-approval Good For?." Accessed October 21, 2022.
- Mass.gov. "Appraisal Process." Accessed October 21, 2022.
- Tax-rates.org. "Massachusetts Property Rates by County." Accessed May 21, 2023.