Buying in Delaware has quirks that national guides get wrong: a transfer tax you split with the seller, a first-time buyer break that changes by municipality, a legal requirement that an attorney handle your closing, and four counties whose markets look nothing alike right now. These are the questions Delaware buyers actually ask, with the source behind each answer.
Last updated: September 2, 2026. Market data: Bright MLS, August 2026.
What you'll actually need at closing
How much cash do I need beyond my down payment?
Plan on roughly 4.5% to 5% of the purchase price, all in. That covers your share of the transfer tax, attorney and title work, title insurance, survey, lender fees, and prorated taxes and utilities. On a $400,000 purchase that's about $18,000 to $20,000 on top of the down payment. It's a real number worth planning around early — more on the mechanics in understanding cash to close.
What is Delaware's transfer tax and what does the buyer pay?
Delaware's realty transfer tax is 4% of the purchase price — 2.5% state and 1.5% local. It's customarily split down the middle, so the buyer pays about 2% and the seller pays about 2%. That split is custom rather than law, so it's negotiable. It is the highest state-level realty transfer tax in the country.
Is there a first-time buyer break on the transfer tax?
Yes, and it comes in two separate pieces that people routinely confuse.
The state reduction is 0.5% off the buyer's rate, capped at $2,000, and it applies only to the first $400,000 of purchase price. To qualify you must never have held a direct legal interest in residential real estate, and you must occupy the home as your principal residence within 90 days of closing. It's applied at settlement by your attorney — there's no separate claim to file.
The local reduction is separate, commonly 0.75% off the county or municipal portion, and it varies by jurisdiction.
Which Delaware municipalities don't offer the local break?
In New Castle County, Elsmere, Newport, the City of Newark, and Middletown do not offer transfer tax relief. Buying in one of those means you get the state reduction if you qualify, but not a local one. This catches people constantly, because a buyer comparing a Middletown house to an unincorporated county house is comparing two different net numbers.
How does the City of Wilmington break work?
Wilmington runs its own exemption with its own paperwork — the Wilmington Realty Transfer Tax Exemption Affidavit. In local settlement practice the test is whether this is your first purchase in the City of Wilmington, not whether you've ever owned a home anywhere. So an owner in Hockessin buying their first Wilmington property can qualify for the city break even though they wouldn't qualify for the state credit. Confirm the current terms with your settlement attorney before you count on it.
What about Cecil County, Maryland?
Maryland transfer and recordation taxes vary by county and municipality, and the structure is different from Delaware's. If you're shopping both sides of the line, get the Maryland number from your lender or settlement attorney rather than assuming Delaware math applies.
Do I need a lawyer to buy a house in Delaware?
Yes. Delaware requires a Delaware-licensed attorney to conduct residential closings and to directly supervise disbursement of settlement funds. That comes from the Delaware Supreme Court in In re Mid-Atlantic Settlement Services (2000) and Delaware State Bar Association v. Alexander (1978), which treat nearly all aspects of a real estate transaction as the practice of law. It isn't optional, and it's why "attorney/title" shows up as a line in every Delaware closing estimate.
Down payment and DSHA assistance
Do I really need 20% down?
No. Conventional loans go to 3% down, FHA to 3.5%, and VA and USDA to zero for eligible buyers. Below 20% you'll carry mortgage insurance, which changes the payment math but not your ability to buy. Where you keep the down payment matters more than most buyers realize.
What down payment assistance does Delaware offer?
The Delaware State Housing Authority runs the main programs. As of this writing the lineup includes:
- Smart Start — a DSHA first mortgage with no down payment assistance attached
- First State Home Loan — 3% of the loan amount, as a zero-interest deferred second mortgage
- Keys4You — 4%, zero-interest deferred second
- Take5 — 5%, zero-interest deferred second, first-time buyers only
- Diamond in the Rough — 5% paired with FHA 203(k) financing for a home needing renovation
First mortgages run through Welcome Home for first-time buyers and Open Door for first-time and repeat buyers (renamed from Home Again in April 2026). Program terms and funding change, so confirm current availability with a DSHA-approved lender. Our guide to down payment assistance programs goes deeper.
Is down payment assistance a grant I don't pay back?
Usually not. Delaware's DPA is typically structured as a zero-interest deferred second mortgage — no monthly payment and no interest, but it's a lien that comes due when you sell, refinance, or pay off the first mortgage. That's still a good deal for most buyers. Just don't plan around it being free money.
Do I have to be a first-time buyer to use DSHA?
Not always. Take5 and Diamond in the Rough are first-time-buyer programs, but First State Home Loan and Keys4You are not, and Open Door serves repeat buyers. Designated targeted census tracts waive the first-time requirement entirely. Income limits apply and vary by county and household size.
When would a buyer skip the assistance?
Two situations come up most. If you have the cash, an unassisted loan avoids putting a second lien on the property. And if you're buying in the City of Wilmington, the city transfer tax break may already cover what the assistance would have. Most other buyers take the maximum they qualify for.
What the Delaware market looks like right now
What does a home cost in Delaware?
August 2026 median sold prices, residential, $100,000–$1,000,000:
| County | Median sold price | Days on market | Months of supply |
|---|---|---|---|
| New Castle, DE | $399,900 | 25 | 2.2 |
| Kent, DE | $365,000 | 40 | 3.3 |
| Sussex, DE | $422,745 | 74 | 5.0 |
| Cecil, MD | $432,000 | 30 | 2.6 |
Is it a buyer's market or a seller's market?
It depends entirely on which county you're in, and that's the most useful thing on this page. New Castle is tight — 2.2 months of supply and 25 days on market, with medians up about 8% year over year. Expect competition and move quickly. Sussex is the opposite — 5 months of supply, 74 days on market, and a median that's actually down slightly from a year ago on rising inventory. Buyers there have room to negotiate and time to think. Kent sits between them. Anyone quoting you one "Delaware market" isn't looking at the data.
How fast do I need to move?
In New Castle County, a well-priced home is going under contract in under a month, so being fully pre-approved before you tour matters. In Sussex, the pace is roughly three times slower and you can be more deliberate. Getting pre-approved is the single highest-leverage thing you can do before shopping in a fast county.
Property taxes and inspections
What will my property taxes actually be?
Don't assume the seller's current bill carries over unchanged. New Castle County completed a reassessment that replaced assessed values dating to a 1983 base year, with new values effective for the 2025–26 tax year and revised bills reissued in late November 2025 after school districts reset their rates. Ask for the current bill, and ask your agent and lender to sanity-check what your escrow will actually be.
Can I appeal my assessment after I buy?
Yes. In New Castle County the appeal window for the following tax year runs January 1 through March 14. Outside that window you can still ask the Assessment Office to correct factual errors about the physical characteristics of the property at any time.
Do I get to see problems with the house before I make an offer?
Yes. Delaware's Buyer Property Protection Act requires the seller's disclosure of known material defects to be given to prospective buyers before they make an offer. It's a statement of what the seller knows, not a warranty, and it doesn't replace your own inspection. Our Delaware Home Selling FAQ covers the seller's side of those duties.
Should I still get an inspection if the seller disclosed everything?
Yes. The disclosure covers what the seller knows; an inspector finds what nobody knew. Here are the inspection red flags worth paying attention to.
What about radon?
Delaware requires sellers to provide any existing radon test results and to notify buyers of known hazards, with a Real Estate Commission form documenting your acknowledgment of testing options. Testing is inexpensive and worth doing regardless of what's disclosed.
A wholesaler offered to sell me a contract. What is that?
That's a wholesale transaction — someone assigning you their contract with a seller rather than selling you a house they own. Delaware now regulates it, and there's a required disclosure form and a 21-day seller cancellation window. Read our breakdown of the wholesaler law before you go that route.
Buying here rewards knowing which county you're in and what your actual cash-to-close number is. If you want both worked out for your situation, reach out — I'll run the numbers before you tour anything, so you're shopping with a real budget instead of an estimate.
This page is general information about Delaware law, programs, and market conditions — not legal, tax, or lending advice. Market figures are Bright MLS data for August 2026 and change monthly. DSHA program terms and funding change; confirm current availability with a DSHA-approved lender. Transfer tax treatment varies by municipality; confirm with your settlement attorney. The "last updated" date above tells you how current this is.
About David Sordelet
David Sordelet is the Designated Broker of Real Broker Delaware and Team Leader of Team Sordelet, with over two decades of experience, 1,000+ transactions, and 200+ five-star reviews across Wilmington, Newark, Hockessin, Dover, Middletown, and the Maryland Eastern Shore.
License: RB-0031238-DE / 5013138-MD
