# DC mortgages: recordation tax, homestead deduction and HPAP

> DC mortgage rules: recordation and transfer taxes, the reduced first-time buyer rate, the $91,950 homestead deduction and HPAP help of up to $202,000.

URL: https://mail.mortgage-math-us.com/location/district-of-columbia/  
Last reviewed: 2026-10-29 · By the MortgageMath US Editorial team

## Quick answer

Buying the median DC home ($733,400) means a recordation tax of about **$10,634** for the buyer, with the seller paying a matching transfer tax. DC’s base combined rate of 2.2% is the 2nd-highest among the states and DC, and it rises on homes priced at $400,000 or more. Qualifying first-time DC homebuyers pay 0.725% instead, on homes up to $777,000. Once you own, the homestead deduction cuts $91,950 from your assessed value, and DHCD’s HPAP lends income-qualified first-time buyers up to $202,000.

## Key facts

| Fact | Value | Source | As of |
|---|---|---|---|
| Recordation plus transfer tax (under the threshold) | 2.2% | [DC Office of the Chief Financial Officer](https://cfo.dc.gov/page/tax-rates-and-revenues-property-taxes) | Oct 28, 2026 |
| First-time homebuyer recordation rate | 0.725% | [DC Office of Tax and Revenue: Form ROD 11, Reduced Recordation Tax Rate for First-Time Homebuyers (FY2026)](https://otr.cfo.dc.gov/sites/default/files/dc/sites/otr/publication/attachments/ROD%2011%20-%20Reduced%20Recordation%20Tax%20Rate%20for%20First-Time%20Homebuyers%20FY2026.pdf) | Oct 29, 2026 |
| First-time rate price ceiling | $777,000 | [DC Office of Tax and Revenue: Notice of Oct. 1, 2025 Tax Changes](https://otr.cfo.dc.gov/release/notice-oct-1-2025-tax-changes) | Tax year 2026 |
| Homestead deduction (assessed value) | $91,950 | [DC Office of Tax and Revenue: Real Property Tax Reliefs, Credits, and Deductions](https://otr.cfo.dc.gov/page/real-property-tax-reliefs-credits-and-deductions) | Tax year 2026 |
| HPAP gap financing, up to | $202,000 | [DC Department of Housing and Community Development: Home Purchase Assistance Program](https://dhcd.dc.gov/service/home-purchase-assistance-program) | FY2027 |
| Homes lived in by their owners | 40.9% | [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25003?g=040XX00US11) | 2024 ACS 1-year |

## Recordation and transfer taxes in DC

When a deed is recorded in the District, two taxes apply at the same rate: the **recordation tax**, which is the buyer’s, and the **transfer tax**, which is the seller’s. On residential sales below $400,000 each is 1.1% of the price (2.2% combined); at $400,000 or more each rises to 1.45%. The higher rate applies to the whole price, not just the part above the threshold.

*DC recordation and transfer taxes at three prices*

| Price | Recordation (buyer) | Transfer (seller) | Total |
|---|---:|---:|---:|
| $350,000 | $3,850 | $3,850 | $7,700 |
| $733,000 | $10,629 | $10,629 | $21,257 |
| $1,000,000 | $14,500 | $14,500 | $29,000 |

For many DC buyers the recordation tax is the largest single closing cost. The [closing cost estimator](https://mail.mortgage-math-us.com/tools/closing-cost-calculator/?state=DC) shows them alongside the CFPB’s typical 2%–5% of other costs.

## The reduced recordation rate for first-time DC homebuyers

DC residents buying their first District home can record the deed at 0.725% instead of the full buyer rate, if household income is within the limits on the Office of Tax and Revenue’s form and the price is no more than $777,000 for tax year 2026. “First-time DC homebuyer” means you have never owned a house, condo or co-op interest in the District that received the homestead deduction (with an exception for a home given up in a divorce). Co-op buyers get reduced rates too. The seller’s transfer tax doesn’t change.

The median home falls under the ceiling, so a qualifying buyer would pay about $5,317 in recordation tax instead of $10,634 — a saving of about $5,317.

> **Tip: File the paperwork with your settlement agent**
>
> The reduced rate is claimed on the Recorder of Deeds form when the deed is recorded, so tell your settlement agent early that you expect to qualify and have income documents ready.

## The homestead deduction and assessment cap

If the home is your principal residence, the homestead deduction removes $91,950 from its assessed value for tax year 2026, which the Office of Tax and Revenue says saves $781.58 a year. Apply online through MyTax.DC.gov: applications filed from October 1 to March 31 get the full year’s benefit; later filings get half. Homesteaded owners are also protected by the assessment cap, which limits the taxable assessment increase to 10% a year even when values jump. Seniors and people with disabilities who qualify can have their tax cut in half.

Census data put the median DC tax bill at $4,594 a year, an effective rate of 0.63%.

## HPAP and DCHFA: DC’s buyer programs

| Program | Run by | Help | Main rules |
|---|---|---|---|
| Home Purchase Assistance Program (HPAP) | DC Department of Housing and Community Development | Up to $202,000 in gap financing plus up to $4,000 for closing costs, as a 0% deferred loan | First-time buyers (no ownership interest in 3 years); income up to 110% of median family income; first-come, first-served |
| DC Open Doors | DC Housing Finance Agency | 0% deferred loan for the minimum down payment, with a below-market first mortgage | First-time or repeat buyers; minimum score 640; borrower income up to $275,400; no price limit |
| DC4ME | DC Housing Finance Agency | VA loan with DCHFA help for closing costs or prepaid items | Eligible veterans and service members |

HPAP repayment depends on income: for lower-income households the loan is deferred until you sell, refinance to take out equity or move out, while moderate-income households start principal-only payments after a deferral period. Funds for the current fiscal year opened October 1, 2026; once you receive a notice to proceed you have a limited window to sign a contract and close. DCHFA also offers a Mortgage Credit Certificate — see [mortgage credit certificates](https://mail.mortgage-math-us.com/first-time-buyers/mortgage-credit-certificates/).

## What the median DC home costs

> **Worked example: $733,400 home, 10% down, 30-year fixed at 7.24%**
>
> | Monthly cost | Amount |
> |---|---:|
> | Principal and interest on $660,060 | $4,498 |
> | Property tax at 0.63% | $385 |
> | Homeowners insurance (national average, $4.90 per $1,000) | $299 |
> | PMI (midpoint of Freddie Mac’s typical range) | $330 |
> | **Total** | **$5,513** |
> 
> Condo and co-op fees, common in DC, come on top.

DC households have the highest median income in the country ($109,707), and that income, at Freddie Mac’s 30% guideline, supports about **$365,000** with 10% down — $368,400 below the median home value. Median owner costs for homes with a mortgage, $3,181/mo, are the highest among the states and DC. Try other numbers in the [mortgage payment calculator](https://mail.mortgage-math-us.com/tools/mortgage-payment-calculator/?price=733000&down=10&tax=0.63&state=DC).

## A city of renters and older homes

Most DC households rent: only 40.9% of occupied homes are owner-occupied, the lowest share in the country (US: 65.3%). The housing is old, too — the median home was built in 1960, the 2nd-oldest stock among the states and DC — which makes rowhouse inspections, condo reserve studies and co-op board approvals part of the process. Renters weighing a purchase against the median rent of $1,931/mo can use the [rent vs buy calculator](https://mail.mortgage-math-us.com/tools/rent-vs-buy-calculator/?state=DC&price=733000&rent=1931). For neighborhood prices and the local market, see the [Washington, DC market guide](https://mail.mortgage-math-us.com/location/washington-dc/).

## Frequently asked questions

### How much is the recordation tax in DC?

The buyer’s recordation tax is 1.1% of the price on homes under $400,000 and 1.45% at $400,000 or more, applied to the whole price. On the median DC home that is about $10,634. The seller pays a matching transfer tax.

### Do first-time homebuyers pay less recordation tax in DC?

Yes. Qualifying first-time DC homebuyers pay 0.725% on houses and condos priced up to $777,000 (tax year 2026), if household income is within the Office of Tax and Revenue’s limits.

### What is the DC homestead deduction?

For tax year 2026 it removes $91,950 from the assessed value of your principal residence, saving $781.58 a year. Homesteaded owners also get the assessment cap, which limits taxable increases to 10% a year.

### How much is HPAP in DC?

DHCD’s Home Purchase Assistance Program offers up to $202,000 in gap financing plus up to $4,000 for closing costs to first-time buyers earning up to 110% of median family income. Funds are first-come, first-served.

### What credit score do I need for DC Open Doors?

DCHFA requires a minimum score of 640. DC Open Doors is open to first-time and repeat buyers with income up to $275,400 and has no maximum sales price.

### Who pays the transfer tax in DC?

The seller pays the transfer tax and the buyer pays the recordation tax; both use the same rate. Contracts can shift costs, so check yours.

## Sources

- [Freddie Mac Primary Mortgage Market Survey](https://www.freddiemac.com/pmms) — 30-year fixed rate, national weekly average (Week of Oct 29, 2026)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25077?g=040XX00US11) — Median value of owner-occupied homes (2024 ACS 1-year)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B19013?g=040XX00US11) — Median household income (2024 ACS 1-year)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25103?g=040XX00US11) — Effective property tax rate (median taxes ÷ median home value); Median real estate taxes paid by homeowners (2024 ACS 1-year)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25064?g=040XX00US11) — Median gross rent (2024 ACS 1-year)
- [Freddie Mac Research](https://www.freddiemac.com/research/insight/homeowners-insurance-costs) — Average homeowners insurance premium per $1,000 of home value (2023 data)
- [Freddie Mac My Home](https://myhome.freddiemac.com/buying/breaking-down-pmi) — Typical PMI cost, low end; Typical PMI cost, high end (Oct 28, 2026)
- [DC Office of Tax and Revenue: Form ROD 11, Reduced Recordation Tax Rate for First-Time Homebuyers (FY2026)](https://otr.cfo.dc.gov/sites/default/files/dc/sites/otr/publication/attachments/ROD%2011%20-%20Reduced%20Recordation%20Tax%20Rate%20for%20First-Time%20Homebuyers%20FY2026.pdf) — DC reduced recordation tax rate for first-time DC homebuyers (houses and condos) (Oct 29, 2026)
- [DC Office of Tax and Revenue: Notice of Oct. 1, 2025 Tax Changes](https://otr.cfo.dc.gov/release/notice-oct-1-2025-tax-changes) — Price ceiling for DC’s reduced first-time homebuyer recordation rate, tax year 2026 (Tax year 2026)
- [DC Office of Tax and Revenue: Real Property Tax Reliefs, Credits, and Deductions](https://otr.cfo.dc.gov/page/real-property-tax-reliefs-credits-and-deductions) — DC homestead deduction (reduction in assessed value), tax year 2026; Annual tax saving from the DC homestead deduction, tax year 2026; DC assessment cap: most a home’s taxable assessment can rise in a year (Tax year 2026)
- [Freddie Mac My Home](https://myhome.freddiemac.com/blog/homebuying/how-much-can-you-afford) — Freddie Mac guidance: housing costs below this share of gross income (Jan 22, 2026)
- [DC Office of the Chief Financial Officer](https://cfo.dc.gov/page/tax-rates-and-revenues-property-taxes) — District real estate transfer tax (Oct 28, 2026)
- [DC Department of Housing and Community Development: Home Purchase Assistance Program](https://dhcd.dc.gov/service/home-purchase-assistance-program) — DC Home Purchase Assistance Program (HPAP) gap financing, up to; HPAP closing cost assistance, up to; HPAP income limit (share of median family income) (FY2027)
- [CFPB](https://www.consumerfinance.gov/owning-a-home/prepare/figure-out-how-much-you-want-to-spend/) — Typical closing costs, low end (share of purchase price); Typical closing costs, high end (share of purchase price) (Oct 28, 2026)
- [42 U.S.C. 12704(14)](https://www.law.cornell.edu/uscode/text/42/12704) — First-time homebuyer: has not owned a home in the past (HUD/HOME statute) (Oct 28, 2026)
- [DC Housing Finance Agency: DC Open Doors](https://dchfa.org/homeownership/dc-open-doors/) — DCHFA DC Open Doors minimum credit score; DCHFA DC Open Doors income limit (Dec 4, 2025)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25088?g=040XX00US11) — Median monthly owner costs, homes with a mortgage (2024 ACS 1-year)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25003?g=040XX00US11) — Share of occupied homes lived in by their owners (2024 ACS 1-year)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25003?g=010XX00US) — Share of occupied homes lived in by their owners (2024 ACS 1-year)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25035?g=040XX00US11) — Median year homes were built (2024 ACS 1-year)
- [DC Office of Tax and Revenue: Real property tax reliefs, credits and deductions](https://otr.cfo.dc.gov/page/real-property-tax-reliefs-credits-and-deductions)
- [DC Office of Tax and Revenue: Reduced recordation tax rate for first-time homebuyers (ROD 11)](https://otr.cfo.dc.gov/sites/default/files/dc/sites/otr/publication/attachments/ROD%2011%20-%20Reduced%20Recordation%20Tax%20Rate%20for%20First-Time%20Homebuyers%20FY2026.pdf)
- [DC DHCD: Home Purchase Assistance Program](https://dhcd.dc.gov/service/home-purchase-assistance-program)
- [DC Housing Finance Agency: DC Open Doors](https://dchfa.org/homeownership/dc-open-doors/)

_General information, not financial advice._