How to buy a home in 2025

You don’t have to do it alone either. When you partner with a buyer’s agent, you’ll have a pro in your corner who knows the process inside and out. They’ll guide you through every step, answer your questions, and help you find the right home … without blowing your budget.

Here we are sharing a step-by-step process for how to buy a house in 2025.

1.  Make sure that you’re financially ready to buy

Before you jump into the home-buying process, first things first … Do you have an emergency fund of 3 – 6 months of expenses saved up? It’s important to have this safety net when you get ready to make a big purchase like a house or unit.

When you buy a home, paying for repairs is your responsibility. So, after you have moved in, if the air conditioner breaks down in the heat of summer, it’ll be no big deal because you have an emergency fund to cover the repairs.

2. Understand how much you can afford

Your next step is figuring out your home-buying budget.

You should only buy a house when the monthly payment is no more than 25% of your monthly take-home pay. Anything more than that and it will put a great deal of pressure on your shoulders.

Sticking to this number leaves plenty of room in your budget to cover home maintenance and repairs while hitting your other money goals, like a yearly family holiday.

If you’re buying a home with your partner, make sure that you’re both on the same page about your budget. This is really important.

3. Save for a deposit

Saving for a deposit will take some time and discipline and it’s a crucial part of this whole process.

How much should you save? If you’re a first-time home buyer, a 5–10% down payment is ok but try and aim for putting a 20% deposit down.

A bigger home deposit may mean not having to borrow as much money, which may mean paying less interest over the life of your home loan. It could also mean paying off your loan sooner.

You should also save up enough cash to cover closing costs like conveyancing, stamp duty, inspections and moving expenses.

Moving expenses will depend on how much stuff you’re moving and how far away your new home is from your current place. To help with budgeting, call a few moving companies in your area for quotes ahead of time.

4. Get pre-qualification and pre-approval for a mortgage

A mortgage pre-qualification is a preliminary step to get an estimate of your borrowing capacity before a full application.

For a more accurate assessment and the ability to make offers on properties, you should apply for pre-approval, which involves a credit check and a review of your financial documents, including proof of identity, income, assets, and liabilities.

Pre-approval is valid for a limited time, usually up to 90 days, and does not guarantee full approval.

Pre-approval takes a little more work. A lender will need to take a look at your payslips, tax returns and bank statements to figure out how big of a mortgage you can afford.

Your lender can also walk you through what your payment and closing costs will be at different price points.

So which mortgage option is right for you?

With a fixed-rate loan, your interest rate is secure for the life of the loan, leaving you protected from rising rates.

Variable-rate mortgages could get you stuck paying a much higher interest rate.

Consider the term of the mortgage too. With a shorter term, your mortgage payment will be higher, but you’ll knock out your mortgage quicker … and save you tens of thousands of dollars in interest. That’s a win!

5. Find the right Buyer’s Agent for you

Your home search might start on realestate.com.au and real estate websites, but it shouldn’t end there.

You can do a lot of research on your own, but you’ll need the help of an expert when it comes to finding and securing your perfect home.

A buyer’s agent can help you navigate the home-buying process and take away a great deal of stress.

In some cases, they can help you find a great house or unit before it hits the market, giving you a competitive edge.

When it comes to making an offer, your agent will negotiate on your behalf so you don’t pay more than you have to. Most people find auctions a very high stress environment so a Buyer’s Agent can bid on your behalf.

So how much does a Buyer’s Agent cost? It’s common for a buyer’s agent to be paid a commission for helping you close on a home. Other’s offer fee-for-service with no commissions.

Be sure to discuss what a Buyers’s Agent charges for their services so you know what your maximum potential costs could be before you commit to working with one.

In every area, there are a lot of Buyer’s Agents and real estate agents, but not all agents bring the same knowledge and experience to the table. A home is the biggest purchase you’ll ever make, and you need a pro on your side.

That means you’ll want to interview a few agents before you hire one. Make them show you why they deserve your business!

6.  Go house hunting

So you have been pre-approved for a mortgage and you know your budget.

Now, you’re ready for the fun part … shopping for your perfect home!

To get started, make a list of must-have home features from your perspective. If you’re buying a home with your partner, make separate lists and compare.

For example, your husband might like a big shed and for you a great kitchen with heaps of counter space is important. A non-negotiable for both of you is that the house is in a good school area.

Knowing what you and your partner want will help with the selection process.

Once you have a clear picture of the features that you both want, share them with your Buyer’s Agent and use them as the foundation of your home search.

Your agent will help you set realistic expectations and target your search to the areas and to the homes that you can afford.

It’s really important that you think about the long term. You might think of the home that you are shopping for as your forever home … but still shop with re-sale value in mind. Your family might grow in the future or a job opportunity in another might come up, which would change your needs.

Here are some house-hunting tips to help you make a smart investment:

Don’t compromise on location or layout. These are two things that you can’t change about the home you buy.

Look past the surface. Don’t let a dated bathroom and laundry keep you from an otherwise great home. These are easy to fix details, which could score you a deal.

Buy the least expensive home in the best neighbourhood that you can afford. That gives your home’s value room to grow in the future.

Pay attention to home values in that area. Are they rising or falling? Are businesses thriving or closing? You can tell a lot about home values in a neighbourhood by what’s happening in the community.

Research the school areas. Even if you don’t have kids, school areas can be an important factor when you sell. Homes in neighbourhoods near great schools generally sell for more money due to high competition.

When you start house hunting, you need to be prepared for it to take a while. It could take months before you find a house that’s right for you and your budget.

Hang in there, and don’t compromise on your must-haves.

7.  Make an offer on a house

Once you’ve found the right home, it’s time to get serious. That means submitting your offer and signing a Contract of Sale with the sellers.

Your Buyer’s Agent will work with you to submit a solid offer. If you end up in a bidding war with other buyers, keep a cool head and put your best foot forward.

You might consider an escalation clause. This is a buyer’s offer strategy in a competitive market, where the buyer agrees to increase their price up to a certain cap to automatically beat competing offers.

Sometimes agreeing on terms is quick and painless, but it can also be one of the hardest parts of the home-buying process.

If your negotiations get intense, remind yourself that both parties want the same thing. The sellers want to sell their house, and you want to buy it!

Sometimes it pays to compromise on little details if that’ll move the process forward. A good real estate agent will give you advice about when to give in and when to hold firm.

Once you get to this step, you’ll officially be under contract on your new home. Under contract means the seller has accepted your offer, but nothing is final yet.

Now that you’re under contract, what should you expect? It normally takes about 30 days to close on a house, so you need to work through the contingencies in the contract.

Contingencies are simply conditions that must be met for the home purchase to take place. They provide a safety net for you to back out of a sale without losing your earnest money if something goes wrong.

Even if you’re in a competitive market, don’t let your emotions lead the charge. You should never skip these contingencies because they offer important protection for your home purchase and your money.

9.  Building Inspection and pest inspection

As a buyer, you have the right to a building inspection before purchasing the house, and it would be crazy not to take advantage of that.

They are not compulsory for buying a property, but they are highly recommended and commonly included as a condition in the contract to protect the buyer.

Getting an inspection will keep you from being blindsided by extensive repairs or structural issues. If the inspection reveals major problems with the home, you can ask the seller to fix the problem, reduce the price, or cancel the contract.

A pest inspection is also highly recommended. Your new home could look perfect from the outside, but you never know what’s going on under the foundation or in the walls.

10. Appraisal

If you’re getting a home loan, your lender will require an appraisal to assess the value of the property.

An appraisal protects you from paying more than the home’s true value. If the appraisal comes in lower than your offer price, your real estate agent can provide the best guidance for what to do next.

11. Getting your mortgage finalised

The final loan approval can take some time and you’ll need to patient.

While you’re waiting, don’t buy a heap of new furniture on credit, get a new credit card, or change jobs. Doing stuff like this affects your debt-to-income ratio and could jeopardise the loan process.

12.  Close on your house

You did it! All the planning, saving, house hunting and waiting are over. Now, the final step in the home-buying process is closing on your new place.

Before you get the keys for your new home and officially call it your own, you’ll have heaps of paperwork to complete and you’ll be signing piles of documents.

If you’re confused by any of the terms or conditions as you work through the paperwork, don’t be shy about asking questions. This is one of the biggest purchases you’ll ever make, and you should know exactly what you’re signing up for.

Once you sign all the paperwork, it’s time to breathe a sigh of relief. You’ve done it!

The home-buying process may not be easy, but having a new home to call your own is well worth it in the end.