How to save for a house deposit: target and timeline
To save for a house deposit, multiply the home price by the deposit percentage you are aiming for, add closing costs, and divide by the months you have. On a $300,000 home, 10 percent down plus 2 percent for closing costs is $36,000, or $1,000 a month over 36 months.
By Swapnanil Dhol. Last updated
How to save for a house deposit
- Choose a target home price. Use a realistic price for the homes you are looking at.
- Pick a deposit percentage. Multiply the price by 5, 10 or 20 percent to compare options.
- Add closing costs. Add roughly 2 to 5 percent of the price for closing costs.
- Set a deadline and divide. Divide the total by the months until you plan to buy.
- Keep an emergency cushion separate. Do not count your emergency fund toward the deposit.
How much is a deposit on a house?
The CFPB says there is no single right amount. In most cases you need at least 3 percent of the home price, many loans and lenders ask for 5 percent or more, and 20 percent is a common benchmark rather than a requirement. In the US a deposit is called a down payment.
| Deposit | Amount | Closing costs at 2% | Total to save |
|---|---|---|---|
| 5% | $15,000 | $6,000 | $21,000 |
| 10% | $30,000 | $6,000 | $36,000 |
| 20% | $60,000 | $6,000 | $66,000 |
How much should I save each month for a house deposit?
Divide the total by your timeline. $36,000 over 36 months is $1,000 a month, and over 48 months it is $750 a month. If you already have $6,000, the remaining $30,000 over 36 months is about $833 a month.
What other costs should I save for?
The CFPB lists closing costs of roughly 2 to 5 percent of the price, plus money for moving, repairs and furnishings. It also advises keeping an emergency cushion of at least three to six months of expenses instead of using it all on the deposit. See how to build an emergency fund.
How do I track a house deposit in Goaley?
Create one goal with your total and the date you want to buy. Goaley: Savings Goal Tracker splits it into weekly, every-two-weeks or monthly contributions, shows the next amount, and keeps a history of every deposit. See the savings plan, or try different timelines in the savings goal calculator.
Turn your deposit target into a dated plan
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