If You’re a First-Time Homebuyer in Cincinnati, Here’s What You Need to Know

If You’re a First-Time Homebuyer in Cincinnati, Here’s What You Need to Know

If You’re a First-Time Homebuyer in Cincinnati, Here’s What You Need to Know

ashley-cantley   Ashley Cantley
August 19, 2023   •   First-Time Homebuyers

Buying a home is a milestone that signifies stability and investment in your future. The journey can be exciting and rewarding in a lively city like Cincinnati, OH. But, if you're a first-time buyer, you need to know a few things about the Cincinnati real estate market and your options.


Steps to Becoming a First-Time Homebuyer in Cincinnati

Cincinnati has a unique blend of urban and suburban lifestyles, which many people love. And if you're first-time homebuying there, it's a huge milestone. Each of the city's neighborhoods has its own personality. From the dynamic energy of Downtown, the city's economic and cultural hub, to the serene, tree-lined streets of Mount Lookout, there's something for every lifestyle and budget.


Even though buying a house can be complex, especially for first-time homebuyers, it's pretty straightforward. Here's the steps:

  1. Save for a down payment
  2. Get a pre-approved mortgage letter
  3. Scouting for potential areas to live
  4. Making an offer and negotiate
  5. Get a home inspection and appraisal
  6. Close on the house

These steps might seem overwhelming, but an experienced real estate agent will guide you on the best path as you become a first-time homebuyer in Cincinnati.


Is Cincinnati Even Affordable for a First-Time Homebuyer?

Absolutely, Cincinnati is affordable! The average home price in Cincinnati is lower than the national average, which means it's an excellent choice for a first home. The best way to approach homebuying there is to understand your budget and the additional costs you might encounter:

  • Securing the Home with a Down Payment: Traditionally, buyers would put down 20% of the home price for the down payment to secure the home. For instance, if a house costs $200,000, the down payment would be $40,000. However, that's not the norm anymore. Many loan options require a much smaller down payment. It can sometimes be as little as 3.5% or even less.
  • Homebuying Closing Costs: These are expenses paid at the end of a real estate transaction, typically 2-5% of your loan amount. For a $200,000 house, you could expect to pay between $4,000 to $10,000.
  • Paying the Monthly Mortgage: The amount you pay your lender monthly will depend on your loan amount, interest rate, and loan term. For example, a 30-year loan at a 3% interest rate for a $160,000 loan (home price – down payment) would be approximately $674 monthly.

These are the expenses first-time homebuyers sometimes forget to factor in:

  • Homeowners Insurance
  • Property Taxes
  • Maintenance Costs

When determining what home you can afford in Cincinnati, factor in homebuying costs and ongoing expenses. When you take it all into account, you won't overextend yourself.


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All the Neighborhood Options in Cincinnati Based on Your Goals

There's a reason why Poet Henry Wadsworth Longfellow called Cincinnati "the Queen of The West," and that's because of its status as the fastest-growing city in the 1800s. It continues to live up to its moniker through its historical contributions, cultural and economic influence, and advancements in various fields that you can feel in each of its neighborhoods. With all that this city offers, here are five factors that can help you when deciding where to live in Cincinnati:

  1. Work-Life Balance Goals: If you're commuting to work, you might want to consider choosing a neighborhood that offers a shorter commute to your work. With Cincinnati's unique location on the Ohio River and its rich industrial and German heritage, commuting times can vary significantly. Some neighborhoods are closer to the city's business district, which houses many industries, from tech start-ups to medical facilities like Cincinnati Children's Hospital, potentially reducing your daily travel time and ensuring a better work-life balance.
  2. Education Needs: The availability of good schools in the area is crucial for families. Specific neighborhoods in Cincinnati are known for their excellent public schools, providing a conducive environment for children's academic growth and development. The city is also home to globally recognized institutions such as the University of Cincinnati and Xavier University, which might influence your decision if higher education is a consideration.
  3. Cultural Stimulation: Proximity to recreational amenities like parks, the Cincinnati Zoo, and museums, including the famed Cincinnati Art Museum, can entice families with young children. If sports are your passion, you might lean towards areas closer to stadiums like the Great American Ball Park or Paul Brown Stadium, reflecting Cincinnati's deep-seated sports culture with teams like the Reds and Bengals.
  4. Financial Fit: The cost of living and housing affordability per neighborhood is another pivotal factor. While Cincinnati's rich legacy as a historic city means it's generally more affordable than many other major cities, specific communities, especially those with historical significance or proximity to the Ohio River, might have higher housing costs. It's vital to factor in the initial price of a home and ongoing expenses like property taxes and maintenance.
  5. Community Vibe: The feel and amenities of a community can be determining factors in your choice. Some Cincinnati neighborhoods, like the vibrant Over-the-Rhine or culturally rich Hyde Park, offer a lively nightlife, while others might be more serene. Food enthusiasts might prefer areas renowned for their unique culinary offerings, such as the iconic Skyline Chili.


Cincinnati has a neighborhood for every type of budget and lifestyle goal. These five factors will help you narrow down the perfect community for you.

What You Need to Buy a House in Cincinnati

Purchasing any home, no matter what neighborhood in Cincinnati you choose, still requires planning and consideration to make it happen. Here are the essentials to prepare for when you are a first-time homebuyer:

  • Reliable Income Source: Lenders will assess your financial stability to ensure you can comfortably afford the mortgage payments. They will look at your employment history, income level, and any outstanding debts you may have.
  • Good Credit Score: Your credit score can significantly impact your mortgage interest rate and terms. Most lenders prefer a score of at least 620. However, the score requirement varies by lender. A higher credit score can potentially secure more favorable terms and lower interest rates.
  • Down Payment: That is the upfront payment made during the purchase of a home. For instance, the median sale price for a home in Cincinnati in March 2023 was $217,000. Typically, a down payment ranges from 3.5% to 20% of the home's worth. However, some programs in Ohio offer support to first-time homebuyers, potentially reducing the down payment required.

Don't forget to plan for ongoing costs associated with homeownership like:

  • Insurance Payments: Offers financial protection against damage to your home or theft of your belongings.
  • Property Taxes: Payments made periodically to local governments vary depending on the area.
  • Maintenance Fees: An integral part of homeownership that can prevent more significant, more costly issues in the future.

When you're prepared, you're better equipped to navigate purchasing a home in Cincinnati, making it a smoother and more successful experience.


The Process of Buying a House in Cincinnati

As a first-time homebuyer, this is the step-by-step guide to owning a home in Cincinnati. It's a straightforward process that includes seven steps:

  1. Partner With an Experienced and Local Real Estate Agent: Finding a knowledgeable real estate agent who understands the Cincinnati market is critical. They can guide you through the buying process, from locating suitable properties to negotiating terms.
  2. Have Your Down Payment Ready to Go: Save as early as possible for the down payment. The more substantial your down payment is, the lower your mortgage payments. This financial preparation is a crucial first step in the homebuying process.
  3. Get Pre-Approved: A pre-approval letter from a mortgage lender shows sellers that you're a serious buyer and can afford to purchase the home. Having this can give you an edge in competitive markets.
  4. Target Your Favorite Neighborhoods: Research different neighborhoods in Cincinnati to find one that aligns with your lifestyle, work, school, or other personal preferences. Knowing this will help streamline your house-hunting process.
  5. Make an Offer, Win the Bid: Once you've found your dream home, your real estate agent can assist you in making an offer and negotiating the terms of the sale.
  6. Hire an Inspector: A home inspection reveals the true condition, beyond what’s shown in a real estate listing or even what you may find when touring the house. This is an essential step to ensure you're making a sound investment.
  7. Close On the House: Once all the paperwork is in order, you can sign the documents to finalize the purchase.


Programs in Ohio That Assist First-Time Homebuyers

As a first-time homebuyer, take advantage of Ohio's many programs. Your real estate agent will guide you in choosing the right one for your circumstance. The Ohio Housing Finance Agency (OHFA) is a great place to start! It's particularly notable for its exceptional assistance programs for low- to moderate-income individuals and families.


OHFA Loan Program provides an excellent resource for first-time homebuyers with the OHFA Loan Program. This program is to assist low- to moderate-income homebuyers. It offers attractive financing options, including a 3% down payment and a 30-year fixed-rate mortgage with no prepayment penalties. This offer means that homebuyers can lock in their monthly mortgage payment for the entire loan term, avoiding the potential stress of fluctuating interest rates. To qualify, homebuyers must:

  • Fall within specific income
  • Meet specific purchase price requirements
  • Meet credit history requirements
  • Work with an OHFA-approved lender
  • Must be first-time homebuyers 


The OHFA Loan Program provides up to $6,000 in down payment and closing cost assistance. This additional financial aid can make the often daunting upfront costs of buying a home much more manageable.

OHFA First-Time Homebuyer Program is similar to the OHFA Loan Program but also includes free homebuyer education and counseling.

OHFA Next Home Program is for individuals who are not first-time homebuyers but still need financial assistance.

Communities First - Down Payment Assistance is a program from The Port of Greater Cincinnati Development Authority and offers first mortgage financing and down payment and closing cost assistance.

Your Choice! program that forgives a loan after seven years, making it a popular down payment assistance option.

Ohio offers a variety of programs to assist first-time homebuyers, making the dream of homeownership more accessible to many. An experienced real estate agent will help you understand the right options for your circumstances.


Loan Options for Homebuyers in Cincinnati

Get familiar with the loan options that are available for first-time homebuyers:

Conventional Loan: Conventional loans are a popular choice for homebuyers with a robust credit score and a considerable down payment. The federal government does not insure these loans, and they typically come with more stringent qualification requirements. However, they also often offer more competitive interest rates and flexible terms. With a Conventional loan, buyers can avoid private mortgage insurance (PMI) by putting down 20% or more of the home's purchase price.

FHA Loan: The Ohio Housing Finance Agency (OHFA) offers FHA loans to first-time homebuyers with lower credit scores and a smaller down payment. These loans are government-insured, making it easier for buyers to qualify. They require a down payment of 3.5% and have different qualification rules, including allowing for lower credit scores, than many Conventional loans. However, they also need borrowers to pay mortgage insurance premiums (MIP), which can add to the overall cost of the mortgage.

VA Loan: VA loans are available through the U.S. Department of Veterans Affairs. They are open to veterans, active-duty military members, and select military spouses. VA loans provide numerous benefits, including no down payment requirement and no PMI. They also often have lower interest rates compared to conventional loans. The VA guarantees a portion of the loan, making it less risky for lenders and often leading to more favorable terms for the borrower.

USDA Loan: The U.S. Department of Agriculture (USDA) loan program is for homebuyers in rural areas. These loans offer 100% financing options, meaning buyers may not need to make a down payment. The USDA loan is also government-backed, which can make qualifying easier. However, specific eligibility requirements relate to income and the property's location.

Each of these loan options has its own set of benefits and drawbacks, so it's crucial that first-time homebuyers in Cincinnati work with an experienced real estate agent who can help evaluate their financial situation, goals, and eligibility to determine the right fit for their needs.


NAF Homes, Your Resource for Homebuying

Buying a house, especially for the first time, can be daunting. But with the proper guidance and resources, it can also be an exciting journey toward owning your dream home. Whether you're pondering whether you can afford a house in your city, deciding where to live, or navigating through the state's first-time homebuyer programs, grants, and loans, the process can be smoother with expert help like NAF Homes. Here's what NAF Homes does:

  • Match prequalified or pre-approved homebuyers with experienced local real estate agents.
  • Pair you with a real estate agent who understands the Cincinnati market and has at least two years of experience.
  • Utilizes expert knowledge and advanced technology to guide you in making the right decisions.
  • Practices high-level communication and professionalism throughout the homebuying process.
  • Leverages connections with other homebuying professionals to ensure a smooth experience.
  • Connects you to programs that turn your offer into a competitive offer.

Want to be paired with a Cincinnati real estate agent? Contact NAF Homes now and let us guide you home.


What are the average home prices in Cincinnati?

Average home prices in Cincinnati are lower than the national average, making it affordable for homeownership. Ohio's average home sales price was $292,433 in June 2023.

When is the best time of year to buy a house in Cincinnati?

The best time to buy a house in Cincinnati varies, but many find the spring and summer months to offer more variety.

How long does it take to buy a house in Cincinnati?

Buying a house in Cincinnati can take a few weeks to a few months, depending on various factors.

Can I buy a house with bad credit and low income in Cincinnati?

Buying a house with bad credit and low income in Cincinnati is challenging but not impossible, thanks to the Communities First - Down Payment Assistance program and other state programs and loan options offered by the Ohio Housing Finance Agency (OHFA).

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