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The housing market has become a bit like the Wild West these last few years. I bought a house this year, but during the two years before that I spent paying off debt and saving money, I watched mortgage rates almost double between spring 2022 and spring 2024.

Are you set on buying a home in 2025? Focus on the following strategies to get yourself in the best shape to buy.

1. Boost your credit score

A higher credit score will directly save you money on a home purchase by qualifying you for a lower mortgage rate. The biggest part of your credit score is your payment history, so if you’ve been lax about on-time payments to creditors in the past, now is the time to focus on that and make every single payment on time.

If you have a way to pay down high-interest debt, like that held on credit cards, that’ll also go a long way toward boosting your credit score by reducing your credit utilization ratio. Your credit report could also have errors dragging down your score, like a delinquent account that was actually paid in full and closed.

Head over to AnnualCreditReport.com to get your free credit reports from the three major consumer credit bureaus and pore over them to see if they’re accurate. If they’re not, you can ask the credit bureau with the error on file to fix it, if you can prove that it’s false.

2. Open a high-yield savings account

Another huge piece of the home-buying puzzle is saving money for a down payment and all the related costs of becoming a homeowner (appraisal, closing costs, et al). I recommend opening a high-yield savings account (HYSA) for this — our favorite ones are still paying around 4% APY.

A HYSA gives you a separate place to keep your savings, away from your checking account. And you’ll earn interest on it, too — that’s passive income, and it can help you grow your funds faster.

3. Research typical home prices

Knowledge is power in all things, but especially when buying a house. Do you know how much you can expect to pay for a house in your area? When I was starting the process, it turned out that I was slightly optimistic when imagining how much I’d pay. I don’t live in a very expensive area, but it has seen price jumps just like the country overall.

Between Q2 2020 and Q3 2024, the median sales price of a U.S. home spiked from $317,100 to $420,400 — or an increase of about 25%. Dig into numbers for your own area (Zillow is great for this), and check current home listings to see what prices look like. Having these numbers will help you prepare for what you can expect to spend — and also refine your down payment target.

4. Vet mortgage lenders

Once you have some dollar figures in mind, it’s time to start looking for mortgage lenders. Good news: We’ve done the hard part for you. Click here for a list of the best mortgage lenders, vetted by our experts.

In addition to saving a solid down payment and improving your credit score, the best way to save money on a home purchase is to shop around with different lenders. They all have different rates and all weigh risk differently.

Here’s a breakdown of rates and payments on a $300,000 home purchased with a 20% down payment.

Saving $40 a month doesn’t sound like a lot, but that’s cash you could use for other bills — and over the life of the loan, that savings comes to over $14,000. So talk to multiple lenders and get pre-approved to see what you could expect to pay.

2025 is a bit of a mystery regarding what the housing market will look like. Experts in the field recently predicted rates in the low 6% range for next year, which is surely an improvement over the 6.69% average we’re looking at now. Whatever happens, if you’ve got your eye on buying in 2025, make the moves above for the best chance of success.

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