November 11, 2021


If you are a first-time homebuyer, the decision to buy a house in Florida can be tricky.

Purchasing a home in Florida is not a very different scenario than in other states. You still have to arrange the finances, cover the insurance, get your potential home inspected, and then close your new home. 

In addition, what you really need to ensure is that you aren’t taken advantage of by any sketchy sellers. 

In this guide, we’ll let you know everything you need to know about how to buy a home in Florida so you can make the process as straightforward as possible - while avoiding all of the common pitfalls. So, let’s get started with all you need to know. 

How to buy

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Choose The Right Neighborhood

Most people began the process of looking for a home by gathering the finances required. But you need to look for the right neighborhood before you do that. There are places with high real estate prices, but the neighborhoods are not appropriate for the life you are looking forward to living. 

Neighborhoods matter a lot for both your potential profit and your home enjoyment in the area. You might wish to sell your home at a later stage to make more profit or to move or upgrade. Better neighborhoods always mean that you will get better value in the future. 

Neighborhoods can influence:

  • The lifestyle and local events available for you and your family.
  • Your overall home value.
  • Whether or not you get annoying neighbors.
  • What kind of measures you will have to take to avoid any crime.

Before you start, narrow down your options to look for specific neighborhoods. Then, you can look at the property trends in specific neighborhoods and see if you can sell it for a better value and in the future if that is why you are buying.

Neighborhoods can impact your daily life, from your commute, to where you dine out, as well as your kids’ school. So, it is good to ask around a few questions and come back at various times of the day or night and see how it all looks and whether you like it or not. 

You can ask locals what they think about the neighborhood and the amenities that it has to offer. If they have been there for a long time, that area might be an excellent place to live.

How Much Does It Cost To Buy A House In Florida?

It is understandable to look at your budget and what you can afford before looking for a property in Florida or anywhere else. You need to consider your:

  • A higher credit score is always better. Your credit score needs to be at 620 or more to get a traditional mortgage loan.
  • Down payment and how much money you are willing to spend upfront. For most loans, you will have to pay around 10 to 20 percent.
  • Debt-to-income ratio because, in most cases, you would only want to spend under 36 percent of your income on debt monthly, including your future mortgage payments.
  • Closing costs are the final fees that are associated with your purchase. These costs can be around 2 to 5 percent of the overall cost. So, for example, for a $200,000 home, you will have to pay around $4,000 to $10,000.
  • Additional homeownership costs or maintenance costs can be approximately one percent annually of a property’s entire worth, at least initially.

Once you have figured out these numbers, you will find out the price range of the home you are looking for. You won’t end up wasting your time on houses that are way too expensive. We will discuss these points in detail in just a bit.

People buying a house in Florida have seen a price hike of approximately 5 percent in recent times. This percentage is projected to go further up in the coming year by at least 5 percent. It has been a common theme for a few years. 

Back in 2011, an average Florida home cost was as low as $137,000. At present, the median listed price of a Florida home is approximately $349,900. But it depends upon which neighborhood you have chosen. The average per square foot price is around USD 164.

What Are The Requirements To Buy A House In Florida?

When looking to buy a Florida home, there are no specific requirements that you need to fulfill. But here are a few general things you must keep in mind when doing so:

  • You need to have a credit score of 620 or more to go for a mortgage with a decent interest rate.
  • The average salary per annum that is required to purchase a home in Florida is around $70,360. Along with your credit score, this is a primary requirement to buy a home in Florida.
  • You must find a trustable real estate agent in Florida.
  • Get a mortgage pre-approval letter to make the entire process much smoother.
  • Develop a valid purchase contract with your real estate agent.
  • Closing costs in Florida are around 2 percent to 5 percent of the overall costs.

How Do I Buy A Home In Florida?

Buying a Florida home is nothing different from buying a house in any other state. You just need to meet the general requirements listed above, and you are good to go. Here are some of the few aspects that you must consider. 

Go Through The Closing Process

As both parties agree, the property will go into escrow. An escrow is a legal arrangement where a third party will temporarily hold the property until a particular condition is met to fulfill the purchase agreement. 

It is used frequently in real estate transactions to protect buyers and sellers during the entire buying process. From here, the closing process of your house in Florida will begin. At this time, a closing date will be set, and both buyer and seller have to meet particular conditions by the time the purchase is finalized. 

The buyer will arrange and schedule a home inspection to visit the property and examine it entirely. A home inspector will look for structural issues or other concerns, such as broken windows or termites. 

If any such issues are found, they will be negotiated and find out whether the seller will fix them or not. At times, they just provide a credit for compensation of costs that are involved. Before closing, you should also want to go through the property to ensure no such problems that might halt your decision to move into this house in Florida.

Go Through The Closing Process

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Make An Offer On The House

If you have found a house in Florida that you would love to move into right away, it is time to offer it. It is as straightforward as telling your real estate agent which house you want to buy and then discussing the amount you are looking to spend on it.

The real estate agent will then develop a purchase contract and submit it to the sellers. At times, based on the property, this contract might have specific conditions associated with the purchase. 

These conditions might include things like any repairs that you might want to complete. Or any appliances you want to be left in the property and the timeframe you think is suitable for closing. 

The seller, at this point, can either accept or reject your offer. Or they can make a counter-offer to you. The real estate agent will assist you in being realistic in your offer, so neither buyer nor seller is taken advantage of. So the real estate agent is playing the middleman role at this point.

Find The Right Home

It is the stage where the expertise and knowledge of your real estate agent will come in handy. You can talk to them about what exactly you are looking for in your new Florida home. Be more specific in your details to give them a better idea of what you want. 

They can narrow down your options in the neighborhood you are looking to move into with more details. One of the few decisions you have to make is whether you plan to purchase a house in Florida or construct it independently. 

Discuss all the essential features that you are looking forward to having in your home. It includes the number of bathrooms and bedrooms or whether you want a pool or not. Besides that, you can discuss the size of the yard that you want to have in your home as your primary residence. 

You can also tell them whether you want to go for a single-story house in Florida or a double-story one, and similar other characteristics that you want to have in your new home. But if you are not sure, you can even ask your real estate agent what’s the best place to buy a home in Florida. 

From here, you will have a chance to look at different Florida homes and see what different areas have to offer. If you are moving in with your kids, then you will need a local school system. If you have a job opportunity in the town, it’s the best time to buy a house in Florida.

Choose A Lender

Lenders play a critical role in having a smooth buying experience. Therefore, you need to look for a trustworthy and professional lender for this purpose. 

They assist you through the entire mortgage process and help you determine how much you can afford when purchasing a Florida home. Apart from that, they also ensure that you are qualified depending on your credit score, current debt, and income. 

The real estate agent you have chosen might also have a preferred lender, but you can make this decision independently. Just like you have done your research to find the right real estate agent, do the same to pick an appropriate lending company that will assist you in the home buying process. 

You can search online and find reviews using services like Yelp and Google to check which lenders have a strong reputation for serving their customers in the region where you are looking to buy a house in Florida.

Close Your New Home

As the closing dates arrive, you must be able to sign and finalize the papers. At this stage, your new home buying process in Florida is complete, and you will get the keys to your new property. The only thing left now is to get your luggage and belongings and move into your new home. 

The entire process will be smooth if you find a quality real estate agent and a trustworthy lender. Furthermore, if you want to spend your own money, the process will become more straightforward as you will not have to research to find a lender. 

But if you do have to find a lender, do your research in the area and go for a reputable entity, so your entire home buying process goes smoothly. If you trust your real estate agent, you can go for the lender that they recommend.

Close Your New Home

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Find A Great Real Estate Agent In Florida

You can buy a house in Florida entirely on your own. But it is recommended to go for a professional to get it done. You need to look for agents who specialize in the local real estate market. 

The entire process will become much smoother as the agent will show you new houses according to your set requirements. Your real estate agent can also recommend different lenders, escrow companies, and a law firm. 

Your Florida Realtor will get you the best deal on offer in the neighborhood where you are looking to move in. Plus, real estate agents are there to help and guide you through the entire home buying process, which can be pretty confusing.

Real estate agents are specifically trained to understand and know what to search for and keep you safeguarded throughout the process. Their experience will come in handy to get the best price for your new Florida home while completing all the paperwork. 

While you choose a reliable real estate agent in Florida, you can take your time and go through some referrals. Then, do some research and look through those online reviews to check what customers say about them. 

Look for some information on how different agents have assisted home buyers in the buying process. There is plenty of information available online that can assist you in making the right choice in choosing who can assist you in buying your new Florida home. 

When you are looking for a real estate agent, here are some factors that you need to keep in mind: 

  • Look for at least two to five years of experience.
  • Go through the online reviews to check what other clients have to say in appreciation.
  • Check how many transactions they have done in the past years. The greater the number of transactions, the more successful the real estate agent is

Evaluate Your Financial Situation

We have touched on this section in the above text briefly. Let us discuss it in more detail to get a better grip on evaluating your financial situation.

Down Payment

Lenders use down payments to set off their risk. With a down payment, you put your skin in the game, as they would like to call it. For instance, if you put in USD 20,000 to purchase a new Florida home, you have a strong incentive not to default on your mortgage. 

It is because you will be paying USD 20,000 if the bank forecloses on your property. You will have to go for a down payment of at least 20 percent for a conventional loan. For the government loans such as FHA or VA loans, the down payments are lower. It is because they have other ways to offset their potential risks.  

For example, veterans qualify for a VA loan without any down payment, but they have to pay the VA funding fee once. On the other hand, FHA loans need down payments that are only 3.5 percent. But the borrower has to pay PMI (Private Mortgage Insurance) during the entire period of the loan. 

For example, in the state of Florida, a home property values around USD 250,000 the down payments will be:

  • VA loan @ 0% → USD 0
  • FHA loan @ 3.5% → USD 8,750
  • Traditional loan @ 20% → USD 50,000

If you are looking for assistance in saving up for your down payments, you can find numerous assistance programs. These programs help low-income and first-time buyers to afford a dream home in Florida. Mostly, these programs are second mortgages or government grants with forgiven or deferred payments. Here are some details that you might want to look into:

  • You can get 3 percent of the purchase price as a non-repayable amount with the 3 Percent HFA Grant.
  • With the Florida Assist Program, you can get up to USD 7,500 as a second mortgage (interest-free) that will only be due when you refinance or resell.
  • With the DPA Hardest Hit Fund, you can get interest-free USD 15,000 as a 5-year loan amount for the residents of specific countries. Moreover, each year 20 percent of the loan is forgiven, and you will not have to repay anything if you stay in your home for more than five years.
  • There are some other options you can explore on Florida Housing Finance Corporation and HUD websites.

Debt-To-Income Ratio

What mortgage lenders need to know is whether you can afford your monthly payments or not. For this, they have to look at your DTI (debt-to-income) ratio and where it would stand after you take out your mortgage. 

It is less likely for you to get the pre-approval letter for a mortgage with a higher ratio. But if you have a high score on your credit report, most lenders are forgiving. For example, some lenders might approve mortgages for borrowers with a ratio of as high as 43 percent. But it is recommended to have this ratio under 36 percent.

How Do I Calculate My Debt-To-Income Ratio?

For calculating your ratio, you must add all your monthly recurring debt payments. Next, add the estimated mortgage payment to the sum of debt payments. Finally, divide this sum by the gross monthly income that you have before taxes. 

When you have figured out how much you have to pay monthly in debt, also include:

  • Student loans.
  • Credit card payments.
  • Child support. 
  • Auto loans.
  • Personal loans.
  • Mortgage payment estimate.

Let us consider an example here for a better understanding. 

If your credit accounts are USD 100, student loans are USD 150, auto loans are USD 250, and a mortgage is USD 1200, the sum will be USD 1700. If your monthly income is USD 4000, then your DTI ratio will be 42.5 percent. 

Remember that this ratio will directly influence the type of mortgage you are going for. For example, traditional loans require a ratio of less than 36 percent, VA loans require under 41 percent and FHA loans require under 43 percent ratio.

These rules are not anything set in stone, but you will have to face more scrutiny if your ratio is higher than these numbers. In the underwriting process. Moreover, you need to consider your other expenses during the assessment of your mortgage eligibility. 

Lenders do not include non-debt costs such as groceries, utilities, health insurance, or retirement savings. So, you must plan for these expenses too. You must calculate what portion of your income goes to these expenses and ensure enough to cover the mortgage payments.

Costs Of Closing

Closing real estate transactions involve different services. These include title searches and document recordings. These services cost money, and the seller pays only some of these closing costs. Therefore, the buyer pays the majority of these costs. As a buyer, your closing costs will go between 2 to 5 percent of the loan amount. It includes:

  • Appraisal fees
  • Property taxes
  • Inspections
  • Homeowner insurance
  • Loan application fees
  • Title insurance fees
Costs Of Closing

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Florida First-Time Home Buyer Programs

With your previous homeowner history, you might qualify for different first-time home buyer programs in the state of Florida. These programs have various advantages, such as low monthly payments, down payment assistance, and improved approval chances.

Florida HFA Preferred Conventional Loans

A lower insurance premium on a mortgage is the most significant benefit of this program. It reduces your monthly payment. Borrowers have to qualify and handle a minimum of 3 percent of the total purchase price down payment. It is a 30-year mortgage with fixed payments.

Florida HFA Preferred 3% Plus Conventional Loans

This program also comes with similar benefits to the standard Florida HFA program. Moreover, it handles the 3 percent down payment, along with the closing costs.

Military Heroes Government Loan Program

Veterans and people on active military duty can benefit from these programs. The benefits involved here range from down payment assistance to low-interest rates.

Florida Mortgage Credit Certificate Program (MCC)

Many first-time Florida house buyers have gone for this program. This program enables them to claim from 10 to 50 percent of mortgage interest (up to USD 2,000).

National First-Time Home Buyer Programs

Besides the local programs, other options are available at the national level that first-time homebuyers can benefit from. These programs assist in different interstate rates, closing costs, and down payment agreements. These include:

  • Traditional loans
  • VA loans
  • FHA loans
  • USDA loans

How To Buy A House In Florida FAQ

See the most asked questions

Is it hard to buy a house in Florida?

Buying a house in Florida is nothing different from buying a house anywhere else. The ease in the process will depend upon all the factors that we have discussed above. 

As long as you have a trustworthy real estate agent, credible mortgage lenders, a quality closing agency that understands the Florida real estate market, purchasing your new home in Florida will be a walk in the park for you.

How do I start buying a house in Florida?

The entire process of buying a house in Florida begins with assessing your current financial situation. When you have figured your finances, you can go for your mortgage pre-approval letter beforehand. Pre-approved mortgages will further smoothen your buying process.  

Once you are done with that, it is time to research finding an experienced and reliable real estate agent with a good reputation. Your agent will recommend that you choose a mortgage lender and a closing agency. However, you can go for your preferred company and service too.

What is the minimum down payment on a house in Florida?

You will need at least 20 percent of the purchase price as a down payment for a traditional loan. However, FHA loans require a down payment of at least 3.5 percent, while VA loans require a 0 percent down payment.

What credit score is needed to buy a house in Florida?

You will need to have a credit score of at least 620 to buy a house in Florida. Of course, the higher, the better. It is the requirement for most conventional loans. If your credit score is below 620 and then start working on improving it right now.

How much are closing costs in FL?

You will have to pay for closing costs that range from 2 to 5 percent of the home value. You will have to incur the cost as a buyer, so you have to have some savings to cover them.

Who pays closing costs in Florida?

There are only a few closing costs that sellers or previous owners are responsible for. Buyers are responsible for most of the closing costs. These costs include loan application fees, appraisal fees, property taxes, inspections, and title insurance fees.

What is a reasonable down payment for first-time homebuyers?

You will have to figure out how much you can afford upfront to determine a reasonable down payment. A conventional loan will require you to pay 20 percent of the home value upfront if you have enough savings. 

For a house in Florida that costs USD 250,000, the down payment here will be USD 50,000. If that is too much, you can go for the FHA loan that requires only 3.5 percent of the home value. The down payment here will be USD 8,750. You can do the math on what you can afford and what not.


Buying a house in Florida is not that difficult. The main factor you will have to focus on is determining your financial situation. It is better to get your mortgage pre-approval letter ahead of time because a pre-approved mortgage will further simplify the entire buying process.

Based on that, you can find a reliable real estate agent with experience in the Florida real estate market. Your agent will help you in your house hunting and will refer mortgage lenders and closing agencies for your assistance. You can go with their option or can do your research. 

Just make sure that you provide your agent with all the details and features you want in your new home in Florida. Then, they will narrow down your options and look for the best deal in the neighborhood where you want to live with your family.

About the Author

As a native Washingtonian, Carlos Reyes’ journey in the real estate industry began more than 15 years ago when he started an online real estate company. Since then, he’s helped more than 700 individuals and families as a real estate broker achieve their real estate goals across Virginia, Maryland and Washington, DC.

Carlos now helps real estate agents grow their business by teaching business fundamentals, execution, and leadership.

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