10 tips for buying a house out of state

Moving across the country can be a hassle or an adventure, no matter how far you’re going. When buying a home out of state, expect to face a few more hurdles than you would moving across town. While every situation is unique, it’s helpful to be prepared for the specific challenges of moving out of state.

Read on to learn how to buy a house out of state, including step-by-step best practices.

1.  Research cost of living

Carefully researching the cost of living is a smart idea, whether you’re still deciding where to move or your job/life circumstances have made the choice for you.

The cost of living varies significantly depending on where you live. Before buying a home in another state, you’ll want to make sure you know what to expect when it comes to paying everyday bills, such as:

• Utilities
• Transportation
• Property taxes
• Medical care
• Childcare
• Groceries
• Entertainment

According to the World Population Review (WPR), the cost of living is the amount of money needed to cover basic necessary expenses, such as housing, groceries, utilities, transportation, healthcare, and miscellaneous goods. This is calculated using a Cost of Living Index (COLI), which establishes a national baseline of 100; states with a score above 100 are more expensive than the national average, while those below 100 are more affordable. Per WPR data, Hawaii is currently the most expensive state with a COLI of 185.0; that means expenses there are 85% higher than the national average. The least expensive state is Oklahoma, with a COLI of 86.0 – in other words, it is 14% cheaper than the average. The overall COLI for the United States is slightly above the baseline at 103.4, and the average American household spends approximately $61,334 annually to cover these essential costs.

To more accurately gauge the cost of living, as well as your actual purchasing power, it's helpful to compare the local or regional price of necessary fixed costs like housing and utilities against the median salary in your area. To help you gauge the potential shift in expenses that come with the change of scenery, you can use a cost-of-living calculator. This can help you determine secondary variables in a given market, like average grocery expenses and state income tax rates versus a national baseline.

2.  Decide what to do with your current home

If you’re renting, giving up your home may be a no-brainer. You can either sell your home or rent it out if you own it. Renting out your home generates income but also requires managing the property from afar or enlisting a professional to do it for you. You’ll also have to pay the mortgage, taxes, and insurance on the home, regardless of whether you currently have a tenant.

Selling your home may be more work in the short term – you may have to sell and buy a home simultaneously – but it could also make life simpler in the long run.

Then again, keeping your property as a rental can be a robust wealth-building move. You can count on a steady stream of passive income from the monthly rent you generate, which may cover a major portion of the mortgage on your new property, all while your existing home continues to increase in value. This strategy enables you to build equity into separate assets at the same time, offering a long-term financial safety valve and additional options for your future investment or retirement portfolio.

3.  Determine how much you can afford to spend

Your new home may require a budget adjustment. Using the Rocket Mortgage Home Affordability Calculator can help you estimate what you’re able to spend in your new ZIP code. The tool gives you a ballpark figure based on details like your location and income.

Factors affecting affordability include your income, as well as expenses such as:

• Closing costs on your new home
• Your available down payment
• Property taxes
• Homeowners insurance, including flood or earthquake insurance if you’re moving to a state where those are risks
• Homeowners association fees, if applicable

Your plan also should consider your time frame for moving and your plans for the future, such as if you plan to start a family or expect to care for parents or in-laws in your new home.

4.  Find a local real estate agent

Local real estate agents possess in-depth knowledge of neighborhoods, property values, and market trends. They can help you understand the market and narrow down your choices. They also have access to the MLS, which may help them locate properties before they hit other online listings. Consider using Redfin to find the right agent for your needs.

Here are some things you can look for in deciding who to work with:

• Proven track record
• Credentials
• Expertise
• Communication style
• Other criteria (works with families, same-sex couples)

In addition to using an online tool to find an agent, you may want to consult home buyers and sellers in the area, sourcing from colleagues, family, friends, or social media groups.

5.  Get mortgage preapproval

Mortgage preapproval is a lender’s estimate of how much you can afford to borrow, based on a review of your financial information. This helps you set a budget for buying an affordable home. Getting a preapproval letter from your lender may make your offer more appealing to a buyer because they’ll have more confidence about your funds coming through.

Mortgage prequalification, on the other hand, offers a preliminary estimate of your borrowing power based on a soft credit check and self-reported data. While it does not guarantee loan approval, prequalification can help you create a realistic home purchasing budget and narrow your search. It also functions as a financial diagnostic tool – if the estimated amount is lower than anticipated, you can proactively improve your credit, decrease debt, or save for a larger down payment to secure better terms in the future.

It’s a good idea to talk to lenders in your new city. That way, you can determine what’s an affordable, realistic mortgage range. You’ll also want to do your research and compare rates and terms from different mortgage lenders.

6.  Check out virtual home tours

Virtual tours provide a few different ways to check out properties remotely, including live FaceTime walk-throughs with your agent and pre-recorded video tours on YouTube. If you desire a more immersive experience, interactive 360-degree tours employ actual photography to create a highly detailed and realistic rendition of each room, and 3D models enable you to digitally maneuver through a home's layout.

The greatest benefit of a virtual tour is that you don’t have to be physically present, and the property can be viewed 24/7. Also, you can view a given property even before you have an agent, or during times your agent is unavailable. Additionally, a virtual tour can help you determine the flow of a home better than still images. 

Virtual tours were particularly popular during the pandemic, but they remain so today. According to Travvir, 87% of home buyers expect virtual tours on property listings in 2026, and listings with virtual tours get 87% more views than those without. Also, properties with virtual tours sell on average 20% faster and at 1% to 3% higher prices. Prerecorded tours remain more popular than live tours.

Ask your agent to show you homes virtually, either with a live video call or a video walk-through. This can help you tour more homes, wherever you may be.

7.  Try to make an in-person visit

If possible, visit your new potential home in person. While you can get a good sense of the interior via a virtual tour, visiting in person helps you get a real sense of a neighborhood, its safety, the quality of nearby parks and walking paths, schools, and shopping options. Tour the area during the day and at night.

Making a home purchase sight unseen is possible, but it may leave you vulnerable to surprises, like loud neighbors or a bad-smelling basement.

8.  Make an offer

Especially if you are making an offer from another state, having robust contingencies is important to lower your risk and bridge the distance. This includes a home inspection contingency, which will allow you to walk away from a deal if something goes awry. In addition to a standard home inspection contingency, think about adding a "sight-unseen" contingency, which gives you a backout option if the property doesn't match what you saw online remotely or during your first in-person visit. And when you make an offer on a house, consider the closing timeline in addition to the price, terms, and conditions. Also, check that all terms are finalized before you fully commit to the long-distance relocation.

Once you and the seller agree on a deal, you both sign a purchase agreement to make it official.

9.  Close on your new home

If you have a mortgage preapproval, then applying for the mortgage should be straightforward. Your lender will underwrite the loan, and the home will be inspected and appraised. You can close the sale in person, which may make it easier to ensure all details are accounted for, or remotely with an e-closing, which offers convenience.

If you plan to close on a house from another state or virtually, the good news is that being remote shouldn’t be a problem for the mortgage application process. That’s because many documents can be filed completely online or handled with a notary where you live.

10. Get ready to move in

Packing up and moving across state lines can be time-consuming and expensive. Be prepared by getting multiple quotes from moving services as far in advance as possible. That will make relocating to another state that much smoother.

According to Angi, the average costs to move out of state today range from $2,000 to $7,000, although your home size and distance will factor into your final amount.

Is it difficult to buy a house in another state?

Depending on your situation, securing financing to buy a house can be challenging. If you’re moving without a new job lined up, it can be more challenging to get a mortgage.

Will there be an overlap between your two homes? When buying a second home, you’re looking at higher down payment requirements. Plus, you might be paying two mortgages for a stint.

If you plan to convert your current home into a rental property, you may need to refinance to a non-owner-occupied mortgage. Expect higher down payments, higher interest rates, stricter credit requirements, and shorter terms.

The bottom line: Be prepared before buying a house out of state

Buying a house out of state can be exciting, but it can also present hurdles. Planning ahead and being prepared will help you avoid potential problems. For help with this, check out more resources from Rocket Mortgage.

Ready to kick-start your home buying journey? Get started with a Rocket Mortgage online application today.