How to Buy a House in Nevada: 6 Steps

fact checked icon

Updated: October 13, 2024

Advertising & Editorial Disclosure

Purchasing a house is a major financial decision that requires careful consideration. In Nevada, the average home value is $445,357, which is higher than the national average of $362,481. This difference highlights the need for potential homebuyers to be financially prepared when considering a purchase in this state.

Understanding down payment assistance programs, mortgage types and Nevada-specific regulations and requirements can ensure a smooth journey toward homeownership in the Silver State. MoneyGeek has compiled pointers to help you navigate the homebuying process in Nevada, from saving the down payment and choosing the ideal location to finding the best financing option for your particular needs and credit history.

Key Takeaways

blueCheck icon

Nevada's average home value is $445,357, which is higher than the national average of $362,481.

blueCheck icon

To buy a home in Nevada, start by finding an ideal location, exploring mortgage options, preparing to meet lenders' requirements and closing on the loan.

blueCheck icon

The Nevada Housing Division offers a down payment assistance program called Home Is Possible to help Nevadans achieve homeownership faster.

Step 1: Prepare to Buy a House in Nevada

According to the U.S. Census Bureau, the homeowner vacancy rate in Nevada for the second quarter of 2024 was 0.7%. The homeowner vacancy rate measures the proportion of vacant homes for sale, indicating the balance between housing supply and demand.

A stable homeowner vacancy rate is 2%. Nevada's rate of 0.7% suggests there is not enough inventory on the market to satisfy homebuyer demand. This scenario often leads to a competitive housing market where buyers may face challenges in finding suitable homes. For homebuyers in Nevada, this means they should be prepared for potentially higher prices and quicker decision-making processes.

Before purchasing a house in Nevada, it's essential to examine your financial and credit history closely. A strong financial profile significantly enhances your chances of getting approved when applying for a mortgage.

Check Your Credit Score

Your credit score plays a pivotal role in determining the mortgage loans and interest rates you qualify for. A higher score increases your chances of securing a reasonable rate. According to Experian, the average credit score in Nevada is 702.

If you have a poor credit score, defined as below 580 on the FICO scale, obtaining mortgage approval may be challenging. Check the table below to see which mortgage type is ideal for you based on the minimum credit score requirements.

Mortgage Type
Description
Minimum Credit Score

Conventional Loan

Conventional loans are standard loans not insured by the government, typically offering competitive rates.

620

Jumbo Loan

Jumbo loans exceed conforming loan limits, making them suitable for high-value properties.

700

FHA Loan

FHA loans are designed for low-to-moderate-income borrowers, often with lower down payment requirements.

500–580, depending on the down payment

VA Loan

VA loans offer veterans and active military members favorable terms and no down payment options.

None given, but may require at least 620

USDA Loan

USDA loans are aimed at rural property buyers, often with no down payment required.

580

Source: Experian

Review Your Debt-to-Income (DTI) Ratio

Your debt-to-income ratio (DTI) is a key metric that helps lenders assess how much of your monthly income goes toward debt payments. This evaluation allows them to determine the amount of mortgage debt you can responsibly take on. According to Experian, the average mortgage debt in Nevada was $286,563 in the third quarter of 2023. Taking on this additional financial responsibility requires careful consideration of your current debts and income.

Your DTI calculation includes monthly debt payments such as housing costs, credit card payments, auto loans, student loans and other obligations. Use our debt-to-income ratio calculator below to see your front-end DTI, which measures the percentage of income going to housing costs, and back-end DTI, which includes all monthly debt payments. This tool will also help you calculate your total monthly debt payments.

cash

Debt-to-Income Ratio Calculator

Calculate your DTI ratio in Nevada based on your basic income and monthly debt payments.

Monthly Income Before Taxes

$

Recurring Monthly Debts

Enter all applicable payments to ensure accurate results.

$
$
$
$
$

Determine How Much You Can Afford

Purchasing a house you cannot afford can lead to financial strain and stress. To avoid this common pitfall, consider using the 28% rule, which suggests that you should not spend more than 28% of your monthly income on your mortgage payment. By adhering to this guideline, you can ensure that your housing costs remain manageable and do not impede your ability to meet other financial obligations.

According to the U.S. Bureau of Labor Statistics, the median annual income in Nevada in April 2024 was $44,810. This translates to a gross monthly income of $3,734 before taxes. Applying the 28% rule, you should aim to keep your monthly mortgage payment at or below $1,046.

Use our mortgage calculator below to get a ballpark figure of your monthly mortgage payment in Nevada.

Mortgage Calculator

Simply estimate your monthly loan payments in Nevada.

Updated: Oct 16, 2024

Fact Checked

Loading...
Please enter a valid US Zip Code
30-Year Fixed

Optional: add taxes, insurance, HOA Fees

Bar Chart Icon

Next Steps

Get personalized mortgage rates from Nevada.

Shield Insurance

Why You Can Trust MoneyGeek

Although MoneyGeek partners with some of the companies we recommend, our content is written and reviewed by an independent team of writers, editors and licensed agents. Learn more about our editorial policies and expert editorial team.

homeMortgage icon
BUDGET FOR ADDITIONAL HOMEOWNERSHIP COSTS

When planning your budget to purchase a house, it's essential to account for more than just the mortgage payment. Property taxes and homeowners insurance are significant expenses that can impact your overall housing costs. These additional costs can vary widely depending on the location and type of home you choose

In Nevada, residents pay a property tax rate of 0.59% on owner-occupied property, according to Tax Foundation data. The average cost of homeowners insurance in Nevada is $1,092 annually. Understanding these costs will help you create a more accurate and comprehensive budget for your home purchase.

Step 2: Save for a Down Payment in Nevada

A down payment is the initial payment made when purchasing a house, typically set at 20% of the home's purchase price. This standard can be challenging for many buyers. In Nevada, with an average home value of $445,357, a 20% down payment amounts to $89,071. For homes priced above the average, like $460,000, the 20% down payment is $92,000.

Fortunately, saving up for a 20% down payment is not mandatory. Many mortgage options allow for smaller down payments. For instance, VA loans require no down payment, while FHA loans require just 3.5%.

If you decide to put down less than 20%, your lender might require you to take out private mortgage insurance. You can use our PMI calculator to estimate your monthly premium based on your credit score and down payment.

Private Mortgage Insurance Calculator

Calculate your monthly private mortgage insurance (PMI) premium in Nevada based on your credit score and down payment.

$
$
%
%
years
Your Expenses
Upfront Insurance Costs

-

Mortgage Loan
Monthly Payment

-

Monthly Mortgage
Insurance Cost (PMI)

-

Explore Down Payment Assistance Programs

Nevada offers several down payment assistance programs that can make homeownership a reality for many potential buyers. These programs aim to alleviate the financial burden of a down payment, making it easier for individuals and families to purchase a home. Refer to the table below for more information on the available down payment assistance programs in Nevada offered by the Nevada Housing Division (NHD).

Program
What It Offers

Home Is Possible (HIP)

This program provides up to 4% of your loan amount to help with the down payment and closing costs. The assistance is offered as an interest-free loan.

Step 3: Find the Right Location in Nevada

Finding the right location in Nevada involves evaluating several factors. Consider the average house price, which can vary significantly across the state. Proximity to family, friends, work or school is another crucial factor. Access to public transportation, parks, restaurants and shopping centers can enhance your lifestyle and convenience.

The cost of living also affects your decision when choosing your new home. According to the Missouri Economic Research and Information Center (MERIC), Nevada's cost of living index in the first quarter of 2024 was 102.7, which is slightly above the national average of 100. When selecting the right location, consider the following essential expenses:

  • Food
  • Health care
  • Clothing
  • Utilities
  • Education
  • Transportation
  • Entertainment

Check out the table below to see some cities in Nevada and their average home values based on recent data. You can also use our cost of living calculator to help you estimate how much you'll need to pay for all the essentials in different locations.

City
Average Home Value

Enterprise, NV

$478,036

Henderson, NV

$485,812

Las Vegas, NV

$426,020

North Las Vegas, NV

$406,543

Reno, NV

$551,222

Source: Zillow

Work With a Real Estate Agent

Working with a real estate agent can greatly speed up your house hunt in Nevada. They provide the advice you need, handle the paperwork efficiently and give you access to an expanded list of property options you wouldn't have alone. They can also recommend other service providers like title companies and inspectors to assist you in buying your home in Nevada.

When finding a real estate agent, do your due diligence and interview agents with experience in the neighborhoods you're interested in. Consider the following tips:

  • Find someone compatible with your needs and personality
  • Verify the agent's credentials, training and licensure
  • Ensure they have in-depth knowledge of the area
  • Shop around for agents and compare their rates

You can also use the license holder search tool from the Nevada Real Estate Division to find or verify real estate agents in Nevada.

Step 4: Shop for the Best Financing Options in Nevada

Navigating the homebuying process in Nevada involves finding a mortgage that fits your budget. Options include conventional, jumbo, FHA, VA and USDA loans. You can choose from 10-year, 15-year, 20-year or 30-year terms and decide whether a fixed-rate mortgage or an adjustable-rate mortgage (ARM) suits you best. Selecting the right financing option can enhance your approval chances and lead to significant savings over time.

Know the Current Mortgage Rates

Interest rates on a mortgage can change daily due to factors like the type of mortgage, the lender, and the economy. While interest rates represent the cost of borrowing, the annual percentage rate (APR) includes additional fees and costs, showing the true cost of borrowing.

As of October 2024, the APR for a 30-year fixed conforming loan in Nevada is 6.09%, while the APR for a 30-year fixed rate FHA loan is 7.88%. Check the table below to see the current mortgage rates in Nevada by mortgage type.

Data filtered by:Results filtered by:
Loan Type:
Loan Type:10-Year Fixed
4.92%APR5.12%
smallCalculator icon
FHA LOAN VS. CONVENTIONAL LOAN

When shopping around for a mortgage in Nevada, you typically choose between government and conventional mortgage programs. FHA loans, a type of government-backed mortgage, generally have more lenient credit score requirements and require a lower down payment than conventional loans. Conventional loans, on the other hand, are not backed by the government and often require a higher credit score.

Use our FHA loan vs. conventional loan calculator to compare options and determine the best one for you by entering your home price, down payment, term length, credit score and interest rate.

Get Pre-Approved

In Nevada, getting pre-approved for a mortgage is a key step in the homebuying process. This step involves a lender evaluating your financial background to determine the amount they are willing to lend. A pre-approval letter is then issued, which can strengthen your offer when negotiating with sellers. This letter is typically valid for 60 to 90 days, giving you a window to find a home within your budget.

To get pre-approved, you will need to submit several documents, including:

  • Proof of income, such as pay stubs or tax returns
  • Credit history reports
  • Identification, like a driver's license or passport
  • Bank statements
  • Information on any outstanding debts

While both pre-approval and prequalification involve assessing your financial situation, they differ significantly. Prequalification is a preliminary step based on self-reported financial information, offering an estimate of what you might qualify for. In contrast, pre-approval involves a more detailed examination of your financial records, providing a more accurate loan amount.

loans icon
HOW TO CHOOSE THE RIGHT LENDER

The mortgage market offers a plethora of lenders, each with unique eligibility requirements, interest rates and fees. Banks often provide a wide range of services and products, though they may have stricter eligibility criteria. On the other hand, credit unions might offer more personalized service and potentially lower rates, but they sometimes require membership.

When choosing the right lender, consider the following tips:

  • Ensure the lender offers the type of loan you want. If you want an FHA loan, verify the lender's FHA approval status.
  • Compare the lender's sample rates with today's mortgage rates in Nevada.
  • Understand the lender's underwriting process and check if you can complete a mortgage application online, by mail or in person.
  • Review customer feedback to gauge the quality of service provided by the lender.

Step 5: Conduct a Home Inspection in Nevada

Home inspections are highly recommended in the homebuying process in Nevada as they provide valuable insights into a property's condition. Inspectors typically examine critical areas such as the roof, foundation, plumbing, electrical systems and HVAC. The inspection report includes detailed findings on these components, helping buyers make informed decisions.

For example, if an inspection reveals major issues like a faulty foundation or outdated electrical systems, it can significantly affect the home's appraisal value. This may lead to a lower appraisal than the purchase price, impacting financing options. In such cases, buyers might decide to rescind their offer based on the inspection results, avoiding potential future expenses related to repairs.

State-Specific Inspections

The Real Estate Division of the Nevada Department of Business and Industry regulates home inspections in Nevada. Home inspectors in the state must adhere to specific standards of practice and a code of ethics outlined by the Real Estate Division. This ensures that inspections are conducted in a professional and consistent manner.

If you're looking for a home inspector in Nevada, make sure they are licensed. It's also wise to check what previous clients have said by reading online reviews and asking for references. You can use the Nevada Real Estate Division's license look-up tool to find or verify licensed home inspectors.

Go Through Appraisal

Home appraisals provide an unbiased estimate of a property's market value. According to the 2023 Appraisal Survey from the National Association of Realtors (NAR), the median appraisal cost in 2023 was $500.

While both inspections and appraisals are essential in the homebuying process, they serve different purposes. A home appraisal determines the property's value, whereas a home inspection assesses its condition. Lenders require appraisals to ensure that the property's value supports the loan amount they are offering, reducing their financial risk.

Step 6: Close on Your House in Nevada

Closing is the final step in buying a house in Nevada, marking the transfer of ownership and the moment you receive the keys to your new property. Your lender must provide a closing disclosure document three days before the official closing. This document outlines your loan terms, projected monthly payments and closing costs. Plan a final walk-through with your real estate agent near closing day to ensure the property is in the expected condition.

Sign All Documents

On closing day, you'll review and complete numerous documents that finalize your home purchase. These documents ensure all legal and financial aspects of the transaction are properly addressed.

  • Final loan application: This document confirms the details of your mortgage, ensuring that all information is accurate and up-to-date. It's your opportunity to verify the terms of your loan before signing.
  • Deed transfer: This legal document transfers ownership of the property from the seller to you, establishing your rights as the new homeowner.
  • Promissory mortgage note: This note is your legal promise to repay the mortgage loan according to the agreed terms. It outlines the repayment schedule and interest rate.
  • Homeowners insurance: Homeowners insurance in Nevada protects your new home against risks such as fire, theft and natural disasters. It provides a safety net to cover potential damages, ensuring your investment is safeguarded.
shakingHands icon
CONSIDER HIRING A REAL ESTATE LAWYER

Hiring a real estate lawyer is a common practice when buying a house, even if not mandatory in Nevada. A real estate lawyer assists with legal documents, ensures compliance with state and federal laws, and represents your interests in negotiations. Their expertise can help avoid potential legal pitfalls, making the homebuying process smoother and more secure.

The cost of hiring a real estate lawyer typically ranges from $700 to $1,250. This variation depends on the complexity of the sale, location, property type and specific needs of the homebuyer.

Pay Closing Costs

Closing costs are fees paid at the end of a real estate transaction, covering various services required to finalize the purchase of a home. According to NAR, the average closing costs in Nevada are $4,939. These costs typically include several fees:

  • Appraisal fee: This fee pays for a professional appraiser who determines the property's market value.
  • Title search and insurance fee: This fee covers the cost of researching the property’s title history to ensure there are no liens or claims against it and provides insurance to protect against future claims.
  • Escrow deposit: This deposit is held by a third-party escrow account to cover future property taxes and insurance premiums.
  • Prepaid costs: These are upfront payments for items like homeowners insurance and property taxes.
  • Other closing costs: This category includes various additional fees, such as loan origination fees and recording fees.

Nevada Homebuying Details: What You Should Know

Understanding the unique aspects of Nevada's homebuying process is necessary for a seamless transaction. State-specific regulations and common practices can significantly impact your experience, making it essential to be well-informed.

1
Seller disclosure is required

In Nevada, sellers must complete a Seller’s Real Property Disclosure form. This form details any known defects or malfunctions in the property, such as issues with the roof, plumbing and electrical systems.

2
Dual agency is legal

Dual agency, where one agent represents both buyer and seller, is legal in Nevada. Both parties must give written consent after full disclosure.

3
Real estate attorneys are not required

Nevada does not mandate a real estate attorney for home purchase closings. However, hiring one can offer extra legal protection, especially in complex transactions.

If you are a first-time homebuyer, learning the different first-time homebuyer programs in Nevada can also help you achieve homeownership faster.

FAQ About Buying a House in Nevada

Buying a house in Nevada is a long-term financial commitment. We answered some frequently asked questions about buying a house in the Silver State to kickstart your homebuyer journey.

How much does it cost to buy a house in Nevada?
What are the requirements to buy a house in Nevada?
What credit score do I need to buy a house in Nevada?
How much income do I need to buy a house in Nevada?
Is buying a house in Nevada a good idea?
sources