Mortgage Guide for Virginia
Virginia's mortgage landscape is shaped by extreme geographic price dispersion, with Northern Virginia's proximity to Washington, D.C. driving home prices well above $600,000 while Southwest Virginia markets remain below $200,000. A significant military presence across Hampton Roads, Quantico, and the Pentagon makes VA loan eligibility unusually common, and the Virginia Housing Development Authority (VHDA) administers multiple down payment assistance and below-market rate programs for qualifying buyers statewide.
Mortgage Numbers for Virginia
| Median Home Price | $385,000 |
|---|---|
| Baseline Conforming Limit | $806,500 |
| Conforming Limit Ceiling | $1,149,825 |
| FHA Loan Limit (Baseline) | $524,225 |
| Avg. Property Tax Rate | 0.82% |
| Avg. Homeowners Insurance | ~0.22% of home value (avg. annual premium) |
| Transfer Tax | 0.25% (Grantor tax (seller-paid). Some localities add 0.05% grantee tax (buyer-paid). Regional congestion relief fees may apply in NoVA and Hampton Roads.) |
| High-Cost Counties | Yes (10 counties — Arlington County, Fairfax County, Loudoun County, Prince William County, Stafford County, Spotsylvania County, Clarke County, Fauquier County, Warren County, and the independent cities within the Washington-Arlington-Alexandria MSA carry elevated conforming and FHA limits ) |
Data sources: FHFA (conforming limits), HUD (FHA limits), U.S. Census (home values), State Department of Revenue (property tax). Updated annually unless noted. Data as of 2026-02-22.
What This Means for Your Mortgage
Property Tax Rates Vary Widely by Locality
Virginia’s average effective property tax rate of approximately 0.82% is below the national median of roughly 1.1% . On a $385,000 home, that translates to roughly $3,157 per year, or $263 per month added to your mortgage payment through escrow. However, Virginia’s independent city system means property tax rates vary dramatically across jurisdictions. Arlington County and Fairfax County carry rates near 1.0%, while many rural counties and independent cities in southern and western Virginia have rates closer to 0.5% to 0.6% . Virginia assesses property at 100% of fair market value, and most localities reassess on a regular cycle (annually or biennially in high-growth areas, every four to six years in slower markets). When lenders calculate your debt-to-income ratio, the full property tax burden counts against your qualifying income, so the locality you choose within Virginia can materially affect how much house you qualify for.
Transfer Taxes: Grantor Tax Plus Optional Grantee Tax
Virginia’s primary transfer tax is the grantor tax, set at $2.50 per $1,000 of the sale price (0.25%). On a $385,000 home, the grantor tax totals $962.50, and the seller customarily pays this cost. Some Virginia localities also impose a grantee tax of $0.50 per $1,000 (0.05%), which adds $192.50 on the same purchase and is paid by the buyer. In Northern Virginia and Hampton Roads, an additional regional congestion relief fee of $0.15 per $1,000 may apply . Compared to high-tax states like Pennsylvania or New York, Virginia’s total transfer tax and recording fee burden is moderate, though buyers should confirm whether their locality charges the grantee tax when estimating closing costs.
Conforming Limits and Northern Virginia’s High-Cost Designation
Virginia has one of the widest conforming limit spreads in the country. Most of the state uses the baseline conforming loan limit set by FHFA of $806,500 for a single-unit property. However, counties and independent cities within the Washington-Arlington-Alexandria metropolitan statistical area carry limits at or near the national ceiling of $1,149,825 . This means a buyer in Arlington or Fairfax can obtain conventional financing on a loan that would require jumbo financing in Richmond or Virginia Beach. FHA limits follow a similar pattern: most Virginia counties use the floor of $524,225, while Northern Virginia jurisdictions carry FHA limits well above $700,000 . Buyers in the NoVA market should verify their specific county’s limit, as the designation follows MSA boundaries and includes some counties that might not seem intuitively “high-cost,” such as Clarke and Warren counties on the MSA fringe.
VA Loan Eligibility Is Unusually Common
Virginia’s concentration of military installations, defense contractors, and federal employees makes VA loan eligibility more prevalent here than in most states. Naval Station Norfolk is the world’s largest naval base. Quantico hosts Marine Corps and FBI facilities. The Pentagon and numerous defense agencies in Arlington and Fairfax employ hundreds of thousands of active-duty, reserve, and civilian personnel. VA loans require no down payment and carry no monthly mortgage insurance, which provides a significant cost advantage in Virginia’s higher-priced markets. In Northern Virginia, where median prices exceed $600,000, a VA loan eliminates the need for a $120,000+ down payment that a 20% conventional loan would require. Eligible borrowers should evaluate VA financing before considering conventional or FHA options, particularly in the NoVA and Hampton Roads markets where the zero-down-payment benefit has the greatest dollar impact.
VHDA Programs for Down Payment and Rate Assistance
The Virginia Housing Development Authority (VHDA) administers several programs for first-time and qualifying buyers. VHDA offers below-market fixed-rate mortgages through its conventional, FHA, and VA loan channels, paired with down payment assistance grants and second mortgages. The VHDA Closing Cost Assistance Grant provides funds toward settlement expenses, and the VHDA Down Payment Assistance Grant can reduce or eliminate the buyer’s cash outlay at closing . Most VHDA programs require completion of a homebuyer education course, a minimum credit score (typically 620), and income below area-specific limits. Because income limits are set by locality, buyers in Northern Virginia’s high-cost areas may qualify at higher income thresholds than those in lower-cost regions.
Insurance and Coastal Flood Risk in Hampton Roads
Virginia’s average homeowners insurance rate of approximately 0.22% of home value is among the lowest in the country. On a $385,000 home, that translates to roughly $847 per year, or $71 per month. However, Hampton Roads and the Eastern Shore face elevated risk from hurricanes, storm surge, and tidal flooding. Properties in Norfolk, Virginia Beach, Hampton, Newport News, and the Eastern Shore may fall within FEMA-designated Special Flood Hazard Areas, requiring separate flood insurance that can add $500 to $3,000 or more annually depending on flood zone classification, elevation, and coverage amount . Sea level rise in the Chesapeake Bay region has increased the number of properties requiring flood insurance, and lenders will not close a mortgage on a property in a designated flood zone without proof of coverage. Coastal buyers should factor flood insurance into their affordability calculations, as this cost directly affects DTI and monthly payment totals.
What This Means for Your Monthly Payment
On a $385,000 Virginia home with 10% down ($346,500 loan) at a 6.5% interest rate, estimated monthly costs break down as follows: principal and interest of approximately $2,190, property tax escrow of approximately $263, homeowners insurance of approximately $71, and PMI of approximately $144 (assuming 0.5% PMI rate). The total estimated monthly payment is approximately $2,668. Virginia’s low insurance rate and moderate property taxes keep the non-principal portion of the payment relatively contained. However, these statewide averages mask significant variation: a buyer in Fairfax County purchasing at the county median near $650,000 would face a substantially higher payment, while a buyer in the Roanoke area purchasing at $250,000 would pay considerably less. Hampton Roads buyers should add flood insurance costs of $40 to $250 per month depending on zone and coverage level. PMI rates vary by credit score, loan-to-value ratio, and insurer, so your actual cost may differ from this estimate.