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Key Takeaways for Minnesota Home Buyers:

Here's what you need to know to get started if you’re looking at buying in the North Star State.

Average Home Prices in Minnesota

As of September 2025, the median sale price for a single-family home in Minnesota is $344,484

Average home price:

  • Minneapolis: $324,173
  • St. Paul: $288,589
  • Duluth: $290,739
  • Mankato: $304,047

Source: zillow.com/home-values

Average Home Size in Minnesota

The average size for a single-family home in Minnesota is approximately 1,960 square feet.

Average home size

  • Minneapolis: 1,884 square feet
  • St. Paul: 1,603 square feet
  • Duluth: 1,538 square feet
  • Mankato: 2,386 square feet

Source: https://fred.stlouisfed.org/

Minnesota State Taxes

  • Minnesota’s individual income tax uses graduated rates of 5.35%, 6.80%, 7.85%, and 9.85% depending on income level.

  • Minnesota's state sales tax rate is 6.875%, and with local additions the average combined state-and-local rate is around 8.12%.

  • The average effective property tax rate in Minnesota on owner-occupied homes is about 0.99% of home value.

How Much Can You Afford in Minnesota?

Recommended
Monthly Payment:
$750.00

affordability graph legend
$750.00
$1050
$1350

Affordable Home Prices With Your Recommended Payment

$107,844.08 house with $9,804.01 down. (10%)

$117,648.09 house with $19,608.02 down. (20%)

$127,452.10 house with $29,412.02 down. (30%)

These examples use the loan term provided and assume a fixed-rate mortgage with an interest rate of 6%.

Minnesota Down Payment Assistance Programs

National Homebuyers Fund FHA Program

This down payment assistance program helps buyers get into a home with little to no upfront cost, offering up to 101.5% financing through an FHA first mortgage and a second lien.

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More about this program
  • FHA loan covers 96.5% of the purchase price
  • Second lien covers 3.5% or 5% for down payment or closing costs
  • Minimum credit score: 600 (660 for manual underwriting)
  • No first-time buyer requirement
  • No max DTI with DU/LP approval
  • Homebuyer education required (Fannie Mae HomeView – free online)
  • Non-occupant co-borrowers allowed
  • Eligible properties: Single-family homes, duplexes (2 units), PUDs, condos (agency approved), townhomes, manufactured homes allowed (except single-wides)

National Community Lending Program

This program supports low- to moderate-income buyers with down payment assistance and flexible financing to make homeownership more accessible.

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More about this program
  • 30-year fixed-rate conventional mortgage
  • Second lien offers up to 4% for down payment assistance
  • Max LTV/CLTV: 97% / 105%
  • Income limit: Up to 140% of area median income (AMI)
  • Minimum credit score: 660
  • DTI: Lesser of 50% or AUS approval
  • Eligible properties: Single-family detached or attached homes, single-family homes with accessory units (must be zoned single-family), PUDs and condominiums, rural properties (must be residential in nature)

Minnesota's Start Up Program for First-Time Home Buyers

The Minnesota Housing Finance Agency’s Start Up Program helps first-time home buyers purchase a home with affordable financing and down payment assistance.

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More about this program

Program Highlights:

  • Income limits up to $152,200, depending on county
  • Purchase price limits up to $659,550 in the 11-county metro area and $604,400 in other counties
  • Down payment and closing cost loan options of up to $18,000
  • Minimum credit score requirement applies
  • Must live in the home as a primary residence
  • Home buyer education course required for at least one borrower before closing

Minnesota's Step Up Program for Repeat Home Buyers

The Step Up Program from Minnesota Housing is designed for repeat buyers or first-time buyers who exceed the income or purchase price limits of the Start Up Program. It offers affordable financing options and assistance to make upgrading or re-entering homeownership more accessible.

purchase-g-radio
More about this program

Program Highlights:

  • Income limits up to $197,900, depending on county
  • Purchase price limits up to $659,550 in the 11-county metro area and $637,950 in other counties
  • Down payment and closing cost loan options up to $14,000
  • Minimum credit score requirement applies
  • Must occupy the home as a primary residence
  • Home buyer education required if all borrowers are first-time buyers

Churchill Mortgage is an approved lender for these down payment assistance programs. Contact us today to see if you qualify!

Frequently Asked Questions

Check our FAQs for responses to our most popular questions from Minnesota home buyers.

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How Much Should I Budget for Closing Costs in Minnesota?

Closing costs in Minnesota usually range from 2% to 5% of the home’s purchase price. These costs may include fees for appraisals, inspections, title insurance, and lender charges. Your loan officer can give you a personalized estimate based on your purchase.

For example, on a $300,000 home, buyers can expect to pay between $6,000 and $15,000 in closing costs. 

Bank
What Are the Most Popular Home Loan Types in Minnesota?

The most common loans among Minnesota buyers are:

  • Conventional Loans – Flexible terms with competitive interest rates. Often preferred by buyers with strong credit and larger down payments, though options with as little as 3% down are available.

  • FHA Loans – Backed by the Federal Housing Administration, these are popular with first-time buyers. They allow lower credit scores and down payments starting at 3.5%.

  • VA Loans – Available to eligible veterans, active-duty service members, and surviving spouses. VA loans require no down payment and no private mortgage insurance (PMI).

  • USDA Loans – Designed for qualifying buyers in rural and suburban areas. These loans also offer no down payment and reduced mortgage insurance costs.

Collaboration
How Can I Find a Trusted Local Minnesota Realtor to Work With?

Churchill Mortgage's experienced Home Loan Specialists work closely with a network of trusted, local real estate agents across the state of Minnesota. Just ask for a referral and we'll provide you with a professional who is committed to finding the right home for you.

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How Do Schools Rank in Minnesota?

Minnesota’s public schools perform consistently well, with many districts earning high marks for academics, student growth, and college readiness. Several districts and schools stand out for their strong performance across multiple metrics.

  • Top districts include Wayzata Public Schools and Eden Prairie Public Schools, which frequently appear among the best in the state.

  • Notable schools such as Minnetonka Senior High School and Math & Science Academy are recognized for rigorous programs and high achievement. 

  • The state uses the Minnesota Department of Education Report Card system to track metrics like proficiency, growth, and graduation rates, available to the public online. 

For detailed school and district data—including test scores and performance comparisons—visit the Minnesota Report Card.

Reviews from Minnesota Home Buyers

★ ★ ★ ★ ★

"John was so knowledgeable and able to break it down for this first-time home buyer, and make it make sense!"

Lauren S.
Alexandria, MN
★ ★ ★ ★ ★

"There were many moving parts and external hangups, but the team pulled together and did everything in their power to ensure all the parts fell into place at the end. Thank you!"

Crystal N.
Roseau, MN
★ ★ ★ ★ ★

"John was kind and patient in explaining anything I didn’t understand and an excellent communicator!"

Mark H.
Minneapolis, MN

4.9 / 5

gold star gold star gold star gold star gold star

Top Rated Mortgage Lender

Served over 100,000+ happy homeowners!

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Minnesota Branch Locations

Churchill Loan Officers in Minnesota

Conforming and high balance allowed. Cooperative housing not eligible. Not all applicants will qualify. Not a commitment to lend. Other restriction or limitations to any program may apply.

This calculator is being provided for educational purposes only. The provided values for interest rates are examples only and do not reflect Churchill Mortgage Product terms & offers. The results are estimates that are based on information you provided and may not reflect Churchill Mortgage Product terms. The information cannot be used by Churchill Mortgage to determine a customer's eligibility for a specific product or service. All financial calculators are provided by a third-party and are not controlled by or under the control of Churchill Mortgage. Churchill Mortgage is not responsible for the content, results, or the accuracy of information.

These calculations are hypothetical examples designed to for illustration purposes only. Consult a Home Loan Specialist for more specific information regarding payments, terms, etc.

As a responsible lender, Churchill Mortgage is committed to the principles outlined in federal and state lending laws ensuring all potential borrowers have access to the same information, services, and opportunities throughout the home loan process.