Your First Home in Ann Arbor: Down Payment Help and the Real Numbers

Two numbers matter most when you buy your first home in Ann Arbor right now: the mortgage rate, which has hovered in the low 7 percent range since late October, and the price of a first purchase, which for most buyers starts in the low-to-mid $300,000s with a condo. Add a Michigan program that can put up to $10,000 toward your down payment and closing costs, and the honest answer to the question I hear every week, 'can I actually do this now?', is usually yes, with a plan. Here is the plan.

The honest math, right now

The 30-year fixed mortgage averaged 7.24 percent for the week ending October 29, 2026, according to Freddie Mac's Primary Mortgage Market Survey, easing slightly from 7.32 percent the week before. At these rates, the purchase price matters more per borrowed dollar than it did a couple of years ago, and so does the down payment. That is exactly where the help below comes in, because the gap between 'I have some savings' and 'I have enough for a down payment plus closing costs' is the real reason first purchases get delayed.

Where first-time prices actually land in Ann Arbor

The condo market is the entry point, and it is healthier than the headlines suggest. According to Condo Hotline's first-half 2026 report, 282 condos sold in Ann Arbor at a median price of $335,000, with sales ranging from about $140,000 to $2.4 million. That sits below Ann Arbor's overall median sale price of roughly $460,000 over the three months ending September 2026, per Redfin, which means a first purchase can be real without waiting for a windfall.

• Median condo price in Ann Arbor, first half of 2026: $335,000, with 282 sales recorded.
• Best entry points sit in the low-to-mid $300,000s, with some condos near $150,000 to $200,000.
• The pace has also turned friendlier to a new buyer: homes are taking longer to sell and inventory is up across Washtenaw County, so you can tour twice, ask questions, and still have time to think.

The $10,000 program most first-time buyers have not heard of

Michigan's state housing agency, MSHDA, runs a pair of loans built for exactly this situation. The headline is the MI 10K DPA loan, which adds up to $10,000 toward your down payment, closing costs, and prepaid expenses. It is a 0 percent, non-amortizing second loan: no interest, no monthly payment, and it is repaid only when you sell, refinance, or pay off your first mortgage. Think of it as help that sits quietly in the background until you are long settled in.

• It must be paired with MSHDA's MI Home Loan, a 30-year fixed-rate first mortgage offered by participating lenders across the state.
• You will complete a homebuyer education class, which is genuinely useful even when no program requires it.
• First-time buyer here means you have not owned a home in the past three years, though repeat buyers can qualify in targeted areas.
• Expect a credit minimum around 640, higher for some loan types, plus income and purchase price caps that are re-set for each county every year. A lender should quote you the current Washtenaw County numbers before you commit to anything.
• MSHDA also offers a smaller MI DPA loan of up to $7,500 for buyers using FHA and similar high-ratio loans. The larger First-Generation grant is currently closed after its funds ran out, so the 10K program is the headline this season.

County help stacks on state help

The help does not stop at the state line. Washtenaw County's Office of Community and Economic Development runs a Homebuyer Assistance Program with homebuyer education and down payment assistance for income-eligible first-time buyers, and University Bank's Neighborly Housing Grant can add up to another $10,000 for eligible Washtenaw County borrowers. These programs are designed to layer: state loan, county assistance, lender grant. That is worth asking about in the very first lender conversation, because the mortgage officer who knows the local programs is the one who will find every dollar you qualify for.

Bring your lender these five things

The fastest way to know what is real is a pre-approval letter, and the fastest way to get one is showing up with a complete file. I send every first-time buyer the same checklist, and almost every delay I see traces back to one missing document.

• Two years of tax returns and W-2 forms.
• Your most recent pay stubs, generally the last 30 days.
• Two to three months of bank and investment statements, all pages.
• A gift letter for anyone contributing to your down payment, so the money has a clean paper trail.
• A short list of questions about your credit score and what would improve it before the rate gets locked.

Why condos belong on your first-home shortlist

In Ann Arbor, the first purchase is usually a condo, and that is a strategy, not a compromise. The $335,000 median from the first half of 2026 puts a credible home within reach of the state and county help above, and condo ownership bundles the parts of homekeeping that eat weekends: exterior upkeep and lawn care, and in many buildings pools, fitness rooms, and common spaces, all covered by the monthly association dues. Condo listings near downtown and campus put restaurants, groceries, and regular bus service within a walk, which keeps city living affordable long before detached home prices come into range.

The one number to always ask about is the monthly association fee and exactly what it covers, because it changes the true monthly cost of the home. A good agent walks you through it line by line before you ever make an offer.

The order that actually works

• Step one: take the homebuyer education class. Required for MSHDA help, and it answers the questions you do not know to ask.
• Step two: talk to two or three lenders and ask each one specifically about the MI Home Loan, county programs, and closing cost help.
• Step three: get pre-approved, not just pre-qualified. The letter is what makes your offer real.
• Step four: tour with an agent who will tell you what is cosmetic and what is structural, so you compare homes fairly instead of falling for the best-staged one.
• Step five: make your offer with a plan for the inspection, the appraisal, and the rate, and close knowing exactly what every fee is for.

"I bought my first home at 24, scared and with no one to explain the paperwork. Every first-time buyer at NEST gets the guide I wish I had: the numbers on the table, the deadlines on a calendar, and my phone number for the questions in between."

Nicole Elizabeth Yaeger