You need about $21,700 to $65,000-plus in savings to buy the $432,900 median-priced home in 2026. Most first-time buyers should plan for $52,000 to $65,000 plus a separate cash reserve.
A down payment is upfront cash you pay toward the price while you borrow the rest. The National Association of Realtors reports the national median single-family existing-home price reached $432,900 in Q3 2026, up 1.7% from a year earlier, in its Q3 metro price report. Prices rose in 78% of metro areas.
Table of Contents
- What a median-priced home costs upfront
- Can you buy with 3 percent down or less?
- What will closing and monthly insurance add?
- How much cash should you keep in reserve?
- How do you set your personal savings number?
What a median-priced home costs upfront
Realtor.com, reporting the NAR 2025 buyer profile, says first-time buyers typically put 10% down, which implies about $43,000 on a median home before other costs, in its first-time buyer down payment analysis. Repeat buyers often put down more. Your market may cost less or more than the national median.
A 10% down payment lowers your loan balance but does not end your upfront costs. You still need closing funds and a reserve. That is why total savings run well above the down payment alone.
Can you buy with 3 percent down or less?
Yes, if you meet program rules. Fannie Mae says its HomeReady mortgage permits qualifying low-income buyers to purchase with as little as 3% down, or about $13,000 on a $432,900 home.
That path leaves more cash for closing and reserves but means a larger loan. Other paths have strict credit or service rules: Check income limits, credit score, property rules, and loan fees before you pick a target. A lower down payment reduces cash today and raises monthly costs later.
- FHA-insured loan: at least 3.5% down with 580-plus FICO; at least 10% down with scores 500-579, per the U.S. Dept. of Housing and Urban Development
- VA-backed purchase loan: no down payment for eligible veterans, service members and some surviving spouses; VA reports nearly 90% close without one, per the U.S. Dept. of Veterans Affairs
- Conventional 10% down: common first-time buyer route, per Realtor.com reporting NAR data
What will closing and monthly insurance add?
Buyers should budget another 2%-5% of the price for closing costs, excluding the down payment, according to the Consumer Financial Protection Bureau in its guide to upfront home costs. On a $432,900 home, that equals about $8,700-$21,600. Fees vary by lender, location, and loan type.
Conventional borrowers putting less than 20% down must pay private mortgage insurance as a monthly fee until reaching 20% equity, according to Freddie Mac. That insurance protects the lender, not you. It raises the ongoing savings needed after move-in.
How much cash should you keep in reserve?
The Consumer Financial Protection Bureau advises buyers not to empty savings for a larger down payment and to reserve cash for moving, repairs, maintenance and emergencies in its down payment savings guide. Total savings must therefore exceed down payment plus closing. A bare-minimum closing leaves you exposed.
For frugal planning, treat reserves as part of the purchase price. Keep down payment, closing estimate, and reserve in separate budget buckets. Do not shift reserve cash to chase a slightly smaller loan.
How do you set your personal savings number?
Start with your loan path, not the median alone. A 3% down buyer faces about $13,000 down plus $8,700-$21,600 closing before reserves.
A 10% down buyer faces about $43,000 down plus the same closing range before reserves. Use this quick math to set a target: Save the full total before you shop. A clear target prevents draining emergency cash at closing.
- Pick likely price based on your metro, not only the $432,900 median
- Multiply price by your expected down-payment share
- Add 2%-5% for closing costs
- Add a separate reserve for moving, repairs, maintenance and emergencies
