How Much Money Do You Need to Buy a House in Houston?
Down payment, closing costs and the monthly costs to plan for
By Natalie Pilkinton, REALTOR® & Real Estate Investor · Updated
Short answer
Plan for four things: a down payment (from 0% with VA or USDA loans, 3.5% with FHA, or 3% to 5% with conventional loans), closing costs of about 2% to 5% of the price, upfront costs while you're under contract, and some reserves.
On a $300,000 Houston home with an FHA loan, that often adds up to roughly $17,000 to $26,500 in total cash before any help. Down payment assistance, seller concessions and builder incentives can cut that substantially — sometimes close to zero.
Minimum down payment by loan type
| Loan | Minimum down | On a $300,000 home |
|---|---|---|
| VA | 0% (eligible veterans and service members) | $0 |
| USDA | 0% (eligible areas and incomes) | $0 |
| FHA | 3.5% with a 580+ credit score | $10,500 |
| Conventional | 3% for many first-time buyers; 5% is common otherwise | $9,000–$15,000 |
Minimums as of October 2026. See [financing options](/buyers/financing) for how each loan works.
A worked example
An illustration, not a quote: a $300,000 home bought with an FHA loan and 3.5% down.
| Item | Estimate | When it's due |
|---|---|---|
| Earnest money (about 1%) | $3,000 | Within 3 days of contract; credited at closing |
| Option fee | A few hundred dollars | Within 3 days of contract; usually credited at closing |
| Home inspection | $400–$1,000 | During the option period |
| Down payment (3.5%) | $10,500 | At closing |
| Closing costs and prepaids (2%–5%) | $6,000–$15,000 | At closing |
| Total cash needed, before any help | About $17,000–$26,500 |
Earnest money and the option fee are usually credited back at closing, so they count toward the total rather than adding to it.
Ways to bring the number down
- Down payment assistance: Texas programs commonly provide 3% to 5% of the loan amount, which can cover an FHA down payment.
- Seller concessions: the seller can pay part of your closing costs, up to your loan's limit.
- New construction incentives: builders often contribute toward closing costs on homes they need to sell.
- Gift funds from family, documented with a gift letter, can be used for the down payment on most loan types.
Where the money can — and can't — come from
- Acceptable: savings, gift funds from family, 401(k) or other retirement accounts, and liquid stocks or bonds.
- Not acceptable: credit cards or unsecured personal loans. Secured loans can be.
- Lenders review about two months of bank statements, so large undocumented deposits need an explanation. Money that has sat in your account for 60 days is easiest to use.
Monthly costs to plan for
Your monthly payment covers principal, interest, taxes and insurance (PITI). Your lender calculates the principal and interest; in the Houston area, taxes and insurance often add as much again.
- Property taxes: Texas has no state income tax, so property taxes are high — commonly around 2% to 3% of your home's assessed value a year, and often more in communities with a municipal utility district (MUD).
- Homeowners insurance: often $2,200–$4,500 a year in the Houston area, plus flood insurance if the home is in a flood zone.
- Mortgage insurance: required on FHA loans and on conventional loans with less than 20% down.
- HOA dues: from a few hundred dollars a year to well over $1,000 in new communities with large amenity packages.
- Escrow changes: when taxes or insurance rise, your lender raises your payment and may ask you to cover a shortage. Budget for it.
Who Natalie works with on financing
Natalie's buyers often start with Brian Lupton at HomeRock Mortgage, who co-presents her Home Buyer Masterclass. Compare his terms with any lender you're considering.
Mortgage broker
HomeRock Mortgage
Brian Lupton, Mortgage Loan Originator
Conventional, FHA, VA and USDA financing, plus help finding the Texas down payment assistance programs you qualify for. Brian co-presents Natalie's Home Buyer Masterclass.
NMLS #2035744 · Company NMLS #1691956
HomeRock Mortgage is part of the HomeRock Group, the same group of companies as HomeRock Realty, Natalie's brokerage. You're free to choose any lender, and you should compare terms. Loan programs, rates and approval are set by the lender.
Frequently asked questions
How much do I need to buy a $300,000 house in Houston?
With an FHA loan, plan on roughly $17,000 to $26,500 in total cash before assistance: $10,500 down plus about $6,000 to $15,000 in closing costs and prepaids, and a few hundred dollars for the inspection. VA and USDA buyers may need much less, and down payment assistance or seller concessions can lower it further.
Can I buy a house in Texas with no money down?
Sometimes. VA and USDA loans require no down payment, and Texas assistance programs can cover an FHA or conventional down payment. You'll usually still need money for the inspection, earnest money and some closing costs unless the seller or a program covers them.
Do I need 20% down?
No. 20% down avoids mortgage insurance on a conventional loan, but most buyers put down far less.
How much should I keep in reserves?
Some loans require reserves equal to a few months of payments, and it's wise to keep a cushion for repairs and escrow increases even when they don't. Your lender will tell you what your loan requires.
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