How to Buy a Home in Maryland in 2025

In 2025, Maryland’s housing market presents a unique opportunity for home buyers. Homes sold above the listed price show a drop of 12.02% Y.O.Y., creating a more balanced market.

This guide provides a detailed plan for buying a home in Maryland, navigating its challenges while leveraging its benefits.

Current Maryland Housing Market Overview (2025)

The Maryland housing market takes a shift in 2025. Buyers have more leverage with the selling of homes with a price drop, showing an increase of 14.78% Y.OY. and 5.9% inventory growth. The median home sale price has reached $448,500, with a 5.35% decrease in the average number of homes sold.

How to Buy a House in Maryland: 7 Steps

Step 1: Figure Out Your Finances

Before searching for homes for sale in Maryland, set a clear budget. The state’s cost of living requires careful financial planning beyond typical home-buying expenses.

Maryland’s effective property tax rate averages 1.06%. Homeowners should plan for mandatory homeowners insurance, required by lenders in all counties. Eligible buyers can also take advantage of the Maryland Homeowners’ Property Tax Credit to offset a portion of their property taxes.

Get Your Down Payment Ready

In Maryland, FHA loans typically require a minimum credit score of 580, while conventional loans usually need at least 620.

First-time buyers can access down payment assistance through programs like the Maryland Mortgage Program (MMP) and SmartBuy 3.0, helping cover part of their 3%–20% down payment and closing costs.

Get Pre-Approved for a Mortgage

In 2025, the average 30-year fixed mortgage rate in Maryland is about 6.28%, with 15-year fixed rates around 5.64%. Buyers should prepare documents such as W-2s or 1099s for the past two years, pay stubs, tax returns, bank statements, photo ID, and proof of assets to complete formal verification.

Pre-approval > pre-qualification: A verified pre-approval strengthens your offer and shows sellers you are a serious buyer.

Step 2: Find Your Dream Home in Maryland

With a set budget, you can find your dream home faster. Houzeo, Maryland’s best home buying website, allows you to browse through the latest listings with smart filters for price, ZIP code, schools, etc.

Whether you are looking for homes for sale in Baltimore, Annapolis, or Montgomery County, the best place to buy in Maryland depends on your priorities.

• Baltimore: Affordable entry, quick appreciation
• Montgomery County: Highest prices, competitive bidding
• Annapolis: Prime waterfront properties

Step 3: Make an Offer That Wins

In Maryland, buyers typically put down an earnest money deposit of 1%–2% of the offer price. Contracts should include inspection and financing contingencies to protect the buyer. Inspection contingencies usually last 7–14 days, with the general home inspection taking about 2–4 hours.

In competitive markets like Baltimore, buyers may need to offer above list price or waive contingencies, while suburban areas like Montgomery County often allow more negotiation.

Step 4: The Crucial Due Diligence Period

In Maryland, buyers typically have 7 to 14 days to complete home inspections. A general home inspection, which takes about 2 to 4 hours for single-family homes, is the most common step. Lenders often require a termite or wood-destroying insect inspection, while radon testing is strongly recommended across the state.

Mold assessments and sewer scopes are also common, especially for older homes, and rural properties may need septic and well inspections to ensure all systems are safe and functional.

This inspection period allows buyers to identify and address potential issues before finalizing the purchase.

Step 5: Secure Your Financing and Insurance

Complete your appraisal, typically within 5–10 days, followed by underwriting, which usually takes 7–14 days. Homeowners insurance is mandatory in all Maryland counties.

Flood insurance is required in FEMA-designated flood zones. Title insurance is strongly recommended, even though it’s not state-mandated.

Step 6: Prepare for Closing Day

In Maryland, closing costs usually range from 3% to 6% of the home’s price. Buyers should plan for expenses such as lender and title fees, state and county transfer taxes, owner’s title insurance, recording and appraisal fees, prepaid property taxes, and applicable HOA or prorated charges.

Step 7: Welcome Home!

Maryland offers valuable benefits for homeowners. Qualifying residents may receive the Homeowners’ Property Tax Credit, and disabled veterans can get an exemption on up to $100,000 of assessed value. Homeowners can also enjoy community amenities and premium services through HOAs or condo associations.

Tips for Maryland Homebuyers: Do’s and Don’ts

Do’s:

• Negotiate inspection repair credits if issues are found
• Leverage state and local down payment assistance if eligible
• Understand the impact of HOAs or condo fees on affordability
• Stay up-to-date on local inventory and price movements

Don’ts:

• Do not skip the inspection, even in a “hot” market
• Avoid making major financial changes before closing
• Don’t underestimate closing costs—plan for the upper range
• Never rely solely on online estimates—visit properties in person

Conclusion

Maryland’s 2025 housing market presents both challenges and opportunities. Steady demand, relatively short days on market, and diverse regional dynamics require careful planning and data-driven decisions.

With preparation, financial readiness, and the support of expert agents using tools, you can confidently navigate the home-buying process and find your Maryland home.

Frequently Asked Questions