Our Top 10 Home Buying Tips for 2025

0:28This episode is brought to you by Accenture. This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required, compatibility and availability varies 18+. It's no secret, buying a home can get complicated. But we want to make it just a little simpler today.

1:03Brent, I am so excited about this because we know that buying a home can be one of the most rewarding milestones on your financial journey. But we also know it can be one of the most complex. So today, we're going to share some of those Money Guy insider tips to help you measure twice, cut once, and buy a home that works for you and your finances. With that, let's jump right in.

1:31So we're going to jump into these 10 tips, Brian. The first one is so important. I think even in today's world, it gets missed often. And it is know your why. Yeah, these are unique times for buying a house. And I want people to know we like homeownership. But I don't want you to feel like you have to have homeownership to build your great, big, beautiful tomorrow. Yeah, I think so many people tell you you have to be a homeowner, have to be a homeowner, have to be a homeowner. It's just not true. It is indeed possible to build financial security, to build to financial independence, even if you're just a renter.

2:05I mean, we even see a lot of our clients who opt to not be homeowners as they enter into retirement, as they enter into financial independence, because it gives flexibility. So don't let someone else tell you you have to buy a home in order to be able to move forward in your financial journey. Yeah, I think if you want to know, because it fits in perfectly with know your why, this has to go beyond just the finances. This is like your life is going to benefit from actually home ownership. And what I mean by this is if you want to set up roots in a community in a certain way. Now, look, I've actually had a lot of people who've written comments that should say, hey, you can rent and actually be in a community and set roots as well.

2:43But we just make sure that it's those elements beyond finances that make it into your decision matrix. And when you're thinking about the why, it doesn't need to just be the why for today. hey, when it comes to buying a home, this should be a long-term decision. So when you make the decision to make this huge purchase, you ought to have the idea or the mindset, I'm going to be here for at least five to seven years so that I can make this giant financial decision make sense. If it's something where you have a shorter time frame than that, home ownership might not be for you. So let's jump into tip number two.

3:16Let's say you have decided, you've gone through and you say, yes, this is what I need in my life is to buy a home, we got to start building that team early. That's right. And you want to think about, okay, if I have a good team in place, again, you have to wrap your head around the idea. For most people, buying a home is the single most expensive thing that you will ever do. It's the largest thing you'll ever spend money on. So you want to make sure you have experts in your corner helping you navigate that well. So when we talk about building a good team, here's some of the professionals we're talking about.

3:50A real estate agent, maybe a mortgage lender, a good inspector. You need to know what title company you're going to use. And then obviously you're going to need to be able to insure this asset. So you're going to need an insurance agent as well. Now look, I just added this up. We've got real estate agent, mortgage lender, inspector, title company, insurance agent. This is like a basketball team. It's a basketball team. This thing, we have stacked it in. So let's go ahead and make something that seems complicated as easy as possible. Let's start with, I'm going to mix up all the analogies because we just did basketball team, but I'm going to say what we need is a quarterback.

4:22We need somebody that's going to wrangle this all together. And that starts with a really good real estate agent. That's exactly right. You need a great quarterback on your basketball team. You heard it here first on the Money Guy shows. Let's talk about how you find that person. How do you find a really good real estate agent? Well, first, let's talk about what you should not do. don't just use a friend. Now, don't mishear us. If you have a friend that's a real estate agent, we're not saying don't use them necessarily, but you want to make sure that the person you're using is actually going to work in your best interest.

4:54Again, this is a huge purchase, a huge decision. You want to make sure that you do it right. And so you don't want to just use a friend simply because there's a relationship connection there. And you might not just want to use someone that some random website like Zillow recommends that you use. Yeah, so let's jump into how you actually do this, because I've done it both ways, by the way. I've had some real estate agents that you're like, oh, man, this seemed like almost a part-time gig, and they're just collecting a commission check. And then I've had other agents that, holy cow, I still am using some of these agents that I think are just world-class.

5:27And that's why we wanted to put together a list so you can make sure you end up on the world-class side of this. And the first thing is go get a referral. Talk to people. if you have somebody in your sphere of influence that you know is buying and selling real estate, go ask them, who do you work with that you're really impressed with on the real estate agent side? And another thing you can do is look at reviews. And if you can't find anyone that has positive experiences, they might just be starting out. And again, that's not necessarily a bad thing, but if there's no review of the person that you're working with and you have no feedback about why you should select this person, you might just want to think through the decision before for committing to go forward with them.

6:06And then see what they've actually sold recently. Here's a stat that kind of blew my mind, but it makes sense when you think about 70 % of real estate agents sold five or fewer homes in 2025. That's wild. So that means that there's a lot of people who are more of, hobby is not the right word, but it definitely does not look like they're not doing a lot of transactions. So this is something you need to find out. And by the way, it's not wrong to ask, tell me how many transactions you're doing in a year so you You can use that as part of your assessment process. So then as you think through this, here's some things we want you to look for when it comes to selecting a really good agent.

6:42The very first thing is they're not a salesman. You don't want someone who cares more about the close, who cares more about the transaction than they do the person who's actually involved in the transaction. You want someone who's actually going to be an advocate for you through the process. Yeah, I mean, I think about some of my good real estate agents. They've helped me with the contracts. They've helped me with inspections. They've helped me fill in when I'm trying to figure out things. And they really are the most versatile player when you're figuring out who your folks are. And they even will help you.

7:15What I think is a good real estate agent, they'll even try to help you find reasons not to buy the property. Yes, they have a conflict of interest potentially because they get paid by the transaction. But a really good agent is going to be your advocate not get caught up in that conflict. And that's why pay attention to, are they telling you where the warts are on this property that you're looking at as well? Yeah. You want a real estate agent that can communicate very easily with you, but it's also willing to answer your questions. If you want to know a little money guy insider tip on how to kind of suss this out, ask your real estate agent questions like this.

7:48Hey, what do you most dislike about this property? Or, hey, I want you to give me one reason why I should not buy this property. And if they give you some very softball answer like, like, oh, the driveway's long, when there might be other underlying issues, like, oh, man, the roof looks worn or there's mold in the basement or something like that, they may not be looking out for your best answer. So make sure you ask good questions and make sure when you ask those good questions, the agent is able to give you really good answers. Now, I think this is going to be a big shortcut. Once you figure out that you've got a good real estate agent, remember how we had a list of five people you had to have in your corner helping you out?

8:27a good real estate agent is going to, and I'm going to use an old school term, Rolodex, or they're going to have the numbers for a lot of those other players that you need to have in your corner. So lean into that, ask you, and you can use that as part of the interview process. Hey, are you going to be able to help me find a good mortgage broker? Are you going to be able to help me find a good title company? These things are important and it's all part of your due diligence process. Now, when you think about mortgage brokers specifically, this can be a great resource to help you shop around for the best deals.

8:58They can help you find potentially significantly discounted rates compared to what your initial quote might be. So a broker is going to shop a number of different lenders for you. So it's not a bad person to have in your corner. Again, if you don't know a broker, you don't have a relationship, if you have a really good real estate agent, a really good quarterback on your team, they will likely be able to help you find the broker that can work in your best interest. And I've already kind of given the point about having a good real estate agent. I would also tell you, don't procrastinate. That's right.

9:28You do not need to just sit on your hands. Don't wait until the last minute. You're going to find out real estate is an illiquid transaction. And so time is one of those things where you're going to need to have extras because we're going to show you need to get some things in order, get your ducks in a row, but you also need to have time to find the right property because it's not an easy overnight process. So you need to be prepared and do a lot of work on the front end. And a great thing is if you can start the conversation with a real estate agent early enough. It's also going to allow you to figure out how you work with this person.

9:58So perhaps you start with an agent and you determine they're not the right person. If you figure that out early enough in the process, you can then make an adjustment that's a better fit for you. All right, Brian. So let's talk about the third tip. And this one I think is a little surprising, but browsing is okay. It's all right to do things like go to open houses or to go online and see what homes are available and what's realistic in the place that you're looking. You don't just have to show up to an open house on the day that you're prepared to actually make an offer and buy. I don't want you wasting real estate agents' times if you're really not in the market.

10:35But there is nothing wrong with the fact that, I mean, I can tell you my most recent deal down in Florida, I think she was probably, she's a great agent, by the way, but I think she was starting to wonder, is this family serious? because I mean, we probably did three or four fact-finding missions. And every time meeting up with her, going out there and looking at properties, that's just part of the job. They understand that is that even good buyers, because to find the right property, remember, this is a transaction. It's not like they're commoditized. That's right. You actually have to, if you're like for us, we were looking for a ranch in the main part of town with this, this, this.

11:10We had like four or five must-haves. And we were going to just keep looking until we found that right thing. I think as long as you're honest with the agent and you're transparent with what you're looking for, browsing is an okay part of the transaction. And one of the great things that browsing does is it allows you to send properties to your realtor so that they can begin to understand what it is that you like, what it is that you're looking for. If you show up on the day that you're ready to go make an offer, they don't really know what to show you. But if you sent them, hey, I like this house, or hey, remember we looked at that one, they're going to be able to better curate for you high probability homes that you might like.

11:47So the earlier you do this work, the earlier you do the research, the more prepared you'll be for the buying process. And speaking of being prepared, tip number four is go ahead and get pre-approved. Now, when we talk about pre-approved, because everybody uses that term way too easily right now, we're not talking about going on some online questionnaire and answering two or three things and getting a rubber stamp pre-approval. That's more of just a process. That's a marketing thing to kind of make an introduction to you. We're actually saying get in there and find a bank or a lender that is actually going to work with you to help you facilitate this transaction.

12:25Yeah, so what we're saying don't do is don't start looking at dream homes just thinking, okay, I can make it work. I'm going to go, well, this house is$3 million. If$3 million is nowhere in your price range, we want you to get pre-approved so you understand what's realistic. But just like you said, we don't want you doing the online pre-approval system that just asks two or three basic questions because that's not going to be an accurate, realistic representation of what you can actually borrow. When it comes to getting pre-approved, there are some things we want you to actually do. and the one that matters the most is actually get a legitimate lender to underwrite you and your unique and specific financials so that they can take an in-depth look and actually give you an accurate representation of what financing is truly going to be available to you.

13:15And this is going to require a little work. I want to go ahead and be transparent on the front end. You probably got to share pay stubs. You got to share tax returns. You're going to have to unlock if you have your credit report frozen, your credit record frozen, you're going to have to unlock it. It is going to require a little work on the front side of things. But this is important because you guys, what happens with real estate is it's slow, slow, slow, and then really fast. And if you'll do this pre-approval process, it at least lets you go into a transaction knowing what you're going to be able to get financing for.

13:46And that time is going to be super, super valuable, especially you get into a competitive situation. You're going to know exactly what you can afford and be ready to act on that very quickly. Now, a word of caution. The lender is on your side. So don't feel like you have to lie to them or you have to fudge your numbers. Be sure that you're honest with your lender so that they can give you an accurate representation of what affordability looks like for you. If you're trying to inflate your income, if you're trying to decrease the debts that you have, it's going to come out in the wash. So be honest and be truthful.

14:18If you do that, it's going to set you up for our next tip. Tip number five, you're going to be better able at this stage to know your numbers. Yeah. I mean, I felt like this is, I love that these kind of go together. When we say know your numbers, we want you to run your own numbers. Because look, you could be working with the best lender in the marketplace, but they're just trying to make sure you look like you can pay for the house. They're not thinking about your savings goals. They're not thinking about when you want to retire. So you need to have that in the background. So maybe you don't take the maximum amount that the lenders tell you you can have.

14:52You actually think about how do I have some life so I'm not house rich, life poor. Build all that into your process by knowing your numbers. I love that. And then the other numbers we want you to know when it comes to running your numbers is that there are costs associated with purchasing a piece of real estate. And there are really two that you need to be aware of. There are the upfront initial costs that you're going to bear, but then there are also the ongoing monthly costs. Now, when we're talking about upfront costs. We're talking about things like down payment. For first-time homebuyers, this is often somewhere between like 3 % to 5 % for second home purchases or people that are upgrading.

15:29This could be as much as 20 % down. There are also going to be closing costs, which a nice rule of thumb is somewhere around 3 % of the purchase price of the home could be the closing costs. And then there are maintenance and furnishing costs. Okay, how much is it going to cost for me when I get in there? Do I need to paint the walls? Do I need to replace the carpet? it do i need to go buy the furniture for the home those are all costs at the very beginning that you need to factor in yeah and by the way several of these things the down payment the closing costs you need to once again do your research on this is because a lot of times with closing costs it is kind of in the industry it says the seller will pay the closing costs maybe not always the case that's why we made sure we listed it on here so you can ask the question or build it into the process.

16:16So you're not caught holding the bag going, Oh my gosh, I didn't take into account that I'm not only going to need the down payment, I might actually need some money for the transaction costs, the cost of even closing on this piece of real estate. And then that leads to the other, you know, costs that most people don't think about, Bo. And this is a big one. I know with both of us, we bought our homes, the maintenance and furnishing costs, just because you can get in the house doesn't mean that you know about the blinds, that's right. About the lawnmowers, about the target run to go buy the ladder for the house and all the cleaning supplies and all it's amazing all these things that you just don't think about i mean even some homes this is gonna sound crazy toilet paper holders and towel towel i was literally about to say my first home the toilet paper there were no toilet paper holders so i just like set it on the back of the commode not realizing i had to go out and buy that stuff so so you need to do your research to know what you're getting into because it's not just the transaction costs it's actually how do you make this a usable asset for you and your family?

17:16So that's the upfront cost, the cost that you're going to bear basically at the time of acquisition and then shortly thereafter. But then there are ongoing monthly costs and you need to run the numbers on these. And these are your principal, interest, taxes, and insurance, which makes up most people's mortgage payment. And there's another one that A, that's association dues. So if you're moving into a neighborhood that has a HOA, if you're moving into a condo that has association dues or fees, you want to make sure that you factor those costs in because those are the costs that you're going to bear month after month after month.

17:49And those are the costs that you're going to be on the hook for, for the entire time that you own this place, unless you pay off that mortgage in full. And I don't want people to sleep on the A because let me give you some examples. When we were down in Florida, looking at this, this last transaction we did, the condos were, you know, you could buy these condos for a few hundred thousand dollars like oh my gosh so what a deal yeah this is so great and then you'd find out that the condo association fees were nine hundred dollars a month you're like wait a minute this the equation for affordability just changed a lot even when we moved here to Tennessee I was shocked at how many HOA fees were 250 dollars a month and greater and you're like okay for 250 dollars a month is this like a gym is this a swimming pool is it what do No, these were just expensive.

18:39There was my builder. He tried to convince me to move into his new neighborhood he was doing. And I said, okay, I'm paying$75 a month for my HOA. What's the new HOA fees for your new neighborhood? Because I'd like to have a bigger lot. And so I think it was like$675 a month. And I was like, what does that come from? That is, it was nothing. It was because it was a gated community and you had to cover the roads. You had to cover. So guys pay attention to that. Hey, it's not just the principal. It's not just the interest. It's not just the taxes. you have to make sure you're taking into account even those HOA or those condo association fees because they could blow up your cash flow if you're not careful.

19:15And when it comes to running the numbers, as you're calculating, okay, what will my mortgage payment be? We want to make sure that we understand rates are higher now than they have been historically for the last five, six, seven years. You need to be okay with the current rate because while rates may come down and you may have some reprieve, it's not a guarantee. So we don't want to see you rush into a mortgage assuming that, okay, I can't really afford it right now, but if rates come down to 5%, then I can afford it. We just don't know when that will happen. So make sure you're comfortable with the current rate.

19:44And if you're confused or you want to figure out how do I calculate all this? How do I actually know what I can afford? We have a great resource for you. Go to moneyguy.com slash resources and play with our home buying calculator. It will actually help you determine for yourself in your unique situation, how much, house can I afford? We want you to marry what you uncover with this tool with what you're pre-approved from the lender. And if those two meet nicely, you're going to have a very solid idea of what the price range of homes you should be looking at is going to be. When you need to build up your team to handle the growing chaos at work, use Indeed Sponsored Jobs.

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21:02With millions of deals on flights, hotels, and rental cars, you can go see the game live. Don't just dream about the trip. Book it with Priceline. Download the Priceline app or visit Priceline.com. Actual prices may vary. Limited time offer. This leads to step number six, or tip number six. I want people to look into assistance programs. Look, this is a big transaction. This is one of those big-to-life decisions. There's so many things in my life that I look back on and I go, if somebody would just tell me so I didn't have to figure this out. Like when I went to college, I didn't know how to apply for scholarships.

21:38I didn't know how to do that. And then I think about how true that is probably for the typical American. It's the same thing with you buying your first house. If you're your first-time homebuyer, realize that is something that the government and a lot of states treat as like a noble cause. They want people to be able to buy into their first home, so they try to incentivize these processes. So we've tried to figure out, hey, for all of our financial mutants out there, how can we help you on this big transaction kind of get a shortcut? And the good news is there's actually a resource. First-time homebuyers, you can go out there.

22:09Nerd Wallet has created a great website where you can go to a portal and just look by state what you qualify for that first-time home purchase. And sometimes it may be you get favorable lending through the state in which you live. It might just be they offer classes around home affordability or things you need to know if you're a first-time home buyer. There's a reason that these programs are there, so make sure you take advantage of them. All it takes is a quick little Google research to figure out what's available in your state to determine if there's something unique. Because if you qualify, it may make sense to look at something like a VA loan, or perhaps it makes sense to look at an FHA loan.

22:48And these programs that are in place for specific people, for specific circumstances, might just be the thing that allows you to actually get on the side of homeownership, that actually allows you to participate in this transaction that you may not have been able to do otherwise. All right. We've thrown out a lot of tips already through steps, I mean, tips one through six. But let's get into another preparation thing. And this is tip number seven. Start saving early. A lot of people will ask us, they say, Brian, Bo, how does home purchases fit into the financial order of operations? And we do build it into it.

23:25It's just you've got to start the planning as soon as possible because it's going to make it that much easier. That's right. The earlier you can figure this out, it's just like most other financial goals. If you can figure it out early on, the steps required, the steps necessary become much, much easier. The longer you wait, the more arduous, the more difficult it is. So figuring it out early is going to make the whole process a lot smoother, a lot more seamless. And like you said, Brian, it does fit into the financial order of operations, but it's not the broad-based step one through nine. It's your specific food based on your specific goals, based on your unique circumstances.

24:05For some people, homeownership might be very, very early on in their financial order of operations. For other people, it might not be something. They've already made it all the way through the financial order of operations. We won't be able to answer that question for you. It's a question that you're going to have to answer for yourself, but there are some ways that you can work through figuring out how to do that. Yeah, anybody who's been on our channel, you know we say for big life decisions, put on your 3D glasses. And what does a 3D plan entail? It means that I want you to look at every big decision in three different ways.