The Minimum Savings You Need To Buy a House Without a Mortgage
A mortgage-free home purchase requires that you save up the entire purchase price, plus closing costs and other fees. Each of those costs is variable, so it's impossible to pinpoint a minimum dollar amount that applies to everyone. But understanding the expenses you'll pay will help you set a realistic savings goal based on your local market and how you want to manage the sale.
Here's a look at roughly how much money you might need to need to buy a house without a mortgage, broken down by each cost.
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Purchase Price
The average home value is $357,445 as of Feb. 18, 2026, according to Zillow. To find out how much you might pay, use real estate sites like Zillow, Redfin and Realtor.com to research recent sale prices in your market and view active listings to see what's available.
Professional Fees
Professional fees you should budget for include broker commissions and attorney fees.
The seller's broker typically pays the buyer's broker, but commissions -- who pays, and how much -- are negotiable. Be prepared to pay some or all of your agent's commission, which could equal 1.5% to 3% of the sale price.
If you'll represent yourself, you'll likely want to have an attorney review your contract before you sign. That could cost several hundred dollars per hour.
Inspection
An inspection is optional, but the few hundred dollars you'll spend on it could save you from making an expensive mistake.
Closing Costs
You won't be taking out a mortgage loan, so your only closing costs will be those associated with transferring title. For example:
Transfer tax: Some state and local governments impose transfer taxes on real estate transactions. Buyers and sellers usually split the cost, which can range from less than 0.5% to 4%, depending on the home's location.
Title work: The title search identifies liens and other claims on the property's title. The title abstract summarizes the findings. They generally total $300 to $600.
Attorney fees: Some states require an attorney to be present at closing.
Closing fee: The title company that coordinates your closing might charge up to 1% of the purchase price. Buyers and sellers sometimes split the fee.
Document handling and recording fees: Your county will record your deed after closing. Administrative costs for that process are usually less than $200.
Homeowners Insurance and Property Tax
Buyers who finance their homes pay up to a year's worth of homeowners insurance and property tax into an escrow account at closing. You won't have to do that, but you'll still need to have the money available to begin your homeowners coverage on closing day -- assuming you insure the home -- and pay your property tax on the next due date.
Homeowners insurance averages over $200 per month, according to Insurify. A tax analysis by Attom found that the average tax for a single-family home is $4,300, based on the most recent data from 2023.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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