6 Biggest Challenges Homebuyers Could Face in 2025 — and How To Avoid Them
Written by
David Nadelle
Edited by
Jenna Klaverweiden
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
New year, new home? Ask any real estate expert, and they’ll tell you that the decision to buy a house is a personal one that can be driven by how your financial situation compares with the housing market. By all accounts, 2025 likely will be a seller’s market, but that doesn’t mean you can’t purchase a new home on your terms.
According to Redfin data for December, the median sale price of a home in the U.S. was $427,430, up 6.2% year over year. Per Zillow, the average value of a home in the country as of Dec. 31, 2024, is $356,585, up 2.6% year over year.
When it comes to the housing market, you take the wins when you can get them. Despite increasing year over year, the median sale price for December was down nearly $3,000 from November, and the number of homes for sale was up 12% year over year. Many are predicting that home prices won’t drop in 2025 but they’ll rise at a slower rate.
In October 2024, Clever Real Estate surveyed 1,000 American adults who expect to buy and/or sell a home in 2025 on their plans and predictions regarding their housing transaction. Here were the top six answers homebuyers had when asked what they thought would be their biggest challenges when buying a home in 2025 — and how to overcome them.
Also see the home trends buyers are looking for in 2025.
Finding the Right Home
In the survey, 57% of homebuyers anticipated finding the right home to be the biggest challenge. According to Quicken Loans, carefully considering your budget, your wants and needs, location, work required, and your offer, you’ll quickly find the right home for you.
You can be willing to compromise on certain features and amenities, but narrowing your focus will put you in a confident position to get exactly what you want. Buying a home is a big decision, so you want to make sure you buy one you’ll be happy to live in.
Staying in Budget
It goes without saying, but you are better off upfront buying something within your original budget. But with home prices and interest rates high, it’s a difficult ask. In fact, 49% of respondents cited staying in budget as their biggest possible challenge.
Going all-in on the house of your dreams or battling through a bidding war may seriously damage your finances. Setting a realistic homebuying budget is an important step toward being financially prepared to own a home. Figuring out your budget goes far beyond down payments, closing costs, moving expenses and other incidentals.
Mortgage Interest Rates
Despite recent rate cuts by the Federal Reserve, mortgage rates are still high. First-time buyers and those looking to move have seen their financial and personal lives hindered by elevated price tags and high borrowing costs for homes. The survey showed that 42% worry mortgage interest rates will pose a challenge this year.
You might be waiting forever for interest rates to drop to what you think is “normal.” But as CBS MoneyWatch suggested, if your finances are in good shape and you can afford to buy now, you could potentially lock down your dream home before properties get more expensive.
Finding a Home in a Good Neighborhood
You shouldn’t buy in an area where you don’t want to live long term and where you think properties don’t look easy to sell. The biggest purchase in your life shouldn’t be shrouded in buyer’s remorse. Yet 34% of survey respondents cited this as their biggest potential challenge this year.
According to Discover, the location of a house could be equally important as the actual house. Research is essential, as is liaising with real estate agents, but you’ll find out a lot by getting your boots on the ground, getting a feel for the neighborhood firsthand and talking to locals.
Moving
A residential move is a significant life change and ranks up there among the highest of stressors at 32%. Gone are familiarity, routine and order — things that we use to cope in our everyday lives.
Moving is also a lot of work, so be organized and allow yourself plenty of time for each step that needs to be done before you move and after you move in.
Competing With Other Buyers
2025 will hopefully see an increase in inventory, but in a seller’s market, competition is fierce, especially when you consider that cash buyers (mainly investors and second-home shoppers) make up 26% of the marketplace, according to data from the National Association of Realtors. And 29% of homebuyers cited competition with other buyers as their biggest potential challenge in 2025.
To be a competitive homebuyer, you need to be creative, persistent and patient, and look for ways to make your offer stand out, like offering to pay for closing or moving costs.
More From GOBankingRates
