Are you trying to buy your first home in Maryland but feeling squeezed by high prices and rising interest rates? You are not alone. Many buyers are running into the same affordability challenges. But with the right information, you can still move forward with confidence.
This post breaks down what is happening in Maryland’s housing market right now, how the Maryland Mortgage Program (MMP) works, and what practical steps you should take before you start making offers.
The Maryland Market Right Now
Home prices are still climbing, and interest rates are higher than in the past few years. This combination makes monthly payments harder to handle. Yet the market is showing signs of shifting. Here is a quick look at recent numbers:
- Median Sale Price: $446,400, up 2.1% year-over-year.
- Housing Supply: Inventory rose 19.6% from last year. Newly listed homes declined slightly.
- Competitiveness: About 32.6% of homes sold above list price. This is down 9 points from last year, which means bidding wars are less frequent but still present.
- Seller Concessions: More sellers are offering closing cost help compared to the COVID-era frenzy. These concessions still depend on the property and how many offers it gets.
For you as a buyer, this means two things: more options than last year and a bit more negotiating power. But you still need to be prepared.
Using the Maryland Mortgage Program (MMP)
The biggest barrier for most first-time buyers is the upfront cost. MMP is designed to solve this “cash to close” problem by helping with down payment and closing costs.
How MMP Works
- First-time buyers get up to 5% of the loan amount in assistance.
- Non-first-time buyers are capped at 3% assistance.
- The help comes as a no-interest, deferred loan. You repay it when you sell the home, rent it out, or refinance with a non-MMP lender.
For example, on a $400,000 home needing about $30,000 at closing, MMP could cover around $19,000. You would only need to bring about $11,000 of your own funds.
Eligibility Requirements
- Income Caps: Vary by county and household size. For example, the limit for a 1–2 person household is $196,680 in Montgomery and Prince George’s counties, and $136,529 in Baltimore area counties. Income from everyone over 18 living in the home counts.
- Credit Score: Generally 660 or higher. Scores between 640 and 660 may qualify with compensating factors.
- Homebuyer Education: All borrowers must complete a course from an approved provider (HUD, Fannie Mae, Freddie Mac). Take it before signing a contract to avoid surprises.
Other MMP-Related Options
- Maryland SmartBuy: Helps pay off student debt. Up to 15% of the home price (max $20,000) can go toward student loans. One borrower’s full debt must be paid at closing.
- Partner Match: Matches funds from an employer, builder, or community partner up to $2,500. Added on top of other assistance.
- Layering Programs: Sometimes you can combine MMP with other down payment assistance programs if combined loan-to-value stays under 105%. Some local rules may limit this.
- For Veterans: VA loan users can apply MMP funds to closing costs and out-of-pocket expenses like inspections.
These programs can shrink the cash you need upfront and help you keep savings intact for emergencies.
Practical Steps Before You Buy
The data and programs are helpful, but your actions matter most. Here is a clear roadmap:
Start with Education and Finances
- Take a first-time homebuyer course early. Many are free.
Get pre-approved with a lender before you contact a real estate agent. This shows you exactly what you can afford.
Choose Your Professional Team Wisely
- Lender: Shop local banks, mortgage brokers, and credit unions. Compare rates and fees. A good lender explains loan types and does not pressure you to borrow more than you are comfortable paying.
- Real Estate Agent: Find a buyer’s agent familiar with your target area. Local expertise matters for negotiations and offer strategies.
- Home Inspector: Always get a thorough inspection. Attend it in person to understand issues firsthand.
Budget and Financial Health
- Do not borrow to the limit of your pre-approval. Leave room for rising taxes and insurance.
- Keep a separate emergency fund for repairs. One recent buyer needed an electrician, a plumber, and an arborist within four months of closing. Assistance programs like MMP help you preserve savings for these surprises.
What This Means for You
Buying a home in Maryland in 2025 takes preparation and patience. The market is still competitive, but you have more leverage than buyers did a year ago. State programs like MMP give you real help with upfront costs.
The key is to educate yourself early, line up your finances, and build a team of professionals you trust. Doing this will help you make smarter offers, avoid common mistakes, and protect your savings after you move in.
What steps are you taking to prepare for your first home purchase? Thinking about using programs like MMP to ease the upfront costs? Your answers will shape how smooth your buying process becomes.