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      For Your Life May 6, 2025

      How to Turn Your Homeownership Goals into Achievable Milestones

      Here is what's happening in today’s real estate market—plus strategies to help you prepare to buy

      Buying and owning a home has been a rite of passage for generations of Americans—a milestone on the path to financial security. In a recent report, 82% of Americans still see homeownership as a key part of the American dream. But today’s housing market is competitive, and buying now may be vastly different from buying in decades past.

      Most people need a game plan to achieve homeownership. Whether you are looking to buy a condo, a single-family home, or a multi-unit property that will give you rental income, part of the process of buying will be to define all the short- and long-term goals you’ll need to accomplish along the way.

      These tips and strategies will help you get started on your journey toward homeownership.

      What is the big picture on the current housing market?

      The housing market is not simple. As with any investment, the details and rules can change depending on many factors—some that are in your control, others that are not. Here are a few things to keep in mind.

      The housing market constantly evolves

      The average home value in 2003 was about $140,000. By 2023, that value had shot up to $340,000. Even with price drops caused by the Great Recession in 2008, the cost of buying a home has steadily risen since 2012. The COVID-19 pandemic and the rise of remote work opportunities have only made houses more valuable. Plus, the slow turnover of housing stock is constantly an issue, as the Baby Boomer and Gen X generations still own more homes than Millennials with kids.

      Many Americans are dealing with student-loan debt

      This can impact a buyer's debt-to-income ratio, which is a key indicator banks use to determine your eligibility for a loan, including mortgages. Also, average monthly payments for student loans in 2025 are $536—a substantial budget line item for many younger people who want to buy. 

      Rising interest rates affect mortgage payments

      Over the last few years, mortgage rates have risen. The average APR for a 30-year fixed mortgage is 6.96% as of mid-April 2025. It’s helpful to understand we are coming off a historical stretch of unusually low rates. (For perspective, in 1981 the market peaked at just over 16%.)

      Achieve your homeownership dream with these goals

      When you see a “For Sale” sign pop up on your dream home, you’ll want to be ready. Get started with short-term goals to prepare for buying, and stay on track with long-term goals that support financial stability as a homeowner.

      Short-term goals: These include making sure your finances and credit are in good shape, saving a nest egg for a down payment, researching local markets, and talking to a lender. Here are five tactics to help kickstart your planning. 

      1. Save toward a down payment

      The industry standard for down payments has long been to save 20% of the estimated purchase price and closing costs, which allows you to avoid an added monthly fee of private mortgage insurance, or PMI. The good news is that there are many ways around large down payments. For low- or moderate-income homebuyers there are options to buy without saving a large down payment, such as the HomeReady Mortgage from Old National.1

      2. Boost your credit score

      This will be a major player in your homebuying experience. Potential lenders use it to determine your eligibility, and it factors into the interest rate for your mortgage. If you start early, you can build a track record of creditworthiness that boosts your score: Pay your bills on time, reduce how much you owe, and leave old credit card accounts open. (The longer you have had credit, the better.) Here is a great resource with more tips to better your score.

      3. Get your finances reviewed

      How much home can you afford? What red flags would a mortgage lender see in your financial life? Talking with a mortgage lender early in your homebuying process can help you refine your search. Lenders can prequalify you, which is an in-depth process that looks at your finances and gives you a sense of what types of mortgages you would qualify for. (Try this quick quiz first). The process can help you make a firm offer on any homes—a plus in a competitive housing market.

      4. Factor in homeownership costs

      If you buy a house that is a fixer-upper, could you make improvements and have a more valuable home in five, 10, or 20 years? Or would you prefer to buy a new or recently renovated home? Consider as well what it will cost for utilities and general upkeep, such as landscaping.

      5. Research local markets

      Make a list of priority amenities and work with a real estate agent to get specific about what you're looking for. Do you want to be close to your job, schools, and activities? Should your ideal square footage include room for a growing family or aging relatives?

      Long-term homeownership goals

      Buying a home is one thing, but having the resources to maintain it is another. You'll need to think about managing debt effectively, securing financing for future upgrades, and setting up a sustainable budget that includes home costs.

      1. Understand your options for financing upgrades. Once you have a mortgage and have been paying if for years, you’ll have equity that can be tapped for a home equity loan or a home equity line of credit (HELOC). You can also take out a personal loan for home improvement, which may be easiest if you need quick cash or have a smaller project.
      2. Set up a realistic budget. As a homeowner, you'll be spending on upgrades and repairs that might be hard to imagine now. Be sure your budget includes setting aside dedicated funds for planned and unexpected purchases.
      3. Manage debt effectively. Once you own your home, you'll want to continue your focus on smart financial practices. Use credit cards selectively, and pay them off in full each month if possible.

      Finding financial support when you need it

      Old National Bank offers HomeReady®1,2 and Home Manager1,3 tools for first-time buyers. If you think you don’t have enough savings for a down payment or are concerned about being approved for a mortgage, these programs can help you buy a home. Benefits include a down payment as low as 3% and access to homebuying resources such as workshops and calculators. You might also be able to remove PMI from future mortgage payments through these programs.

      Our Old National Down Payment Assistance Program1,4 works in tandem with HomeReady and Home Manager to provide additional funds for a down payment. If you qualify, you could receive $15,000 toward the purchase price.

      Homeownership strategy tailored to your goals

      In today’s competitive housing market, it is never too early to start your homebuying journey. Work on your credit score, save for a down payment, and start refining a list of desired amenities. Old National's expert lenders and financial planners are available to guide you through the process. They'll help you create a homeownership strategy that fits your needs and goals. Find an expert lender at Old National Bank and make an appointment today.

       

      1All loans are subject to credit review and approval. Property insurance required for all loans secured by real estate. Rates are subject to change daily. Contact your Old National Banker or Residential Lender for current loan rates. Bank NMLS #459308.

      2ONB's HomeReady Program is subject to geographic restrictions and program conditions may be subject to change without notice. Down payment assistance programs are subject to availability and subsidies range between $3,000 and $6,000.

      3ONB's Home Manager Program available only for first-time homebuyers. Additional qualifications may apply. Requires successful completion of a Home Buyer Education Program certified by the Dept. of Housing and Urban Development (HUD).

      4ONB's Down Payment Assistance program funds are limited and subject to availability. Amounts applicable in the following eligible counties (IL) Cook, DuPage, Grundy, Kane, Kendall, Lake, and Will; (MI) Kent and Washtenaw; (IN) Allen and Marion; (MN) Hennepin and Ramsey; (KY) Jefferson; (TN) Cannon, Davidson, Rutherford, Sumner, and Williamson; (WI) Dane and Milwaukee. Specific census tracts and other restrictions may apply. Program conditions subject to change. Old National reserves the right to discontinue program at any time

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