How to Own Your Dream Home

For most people, their first home isn’t their dream home. It starts off nice enough. But as time goes by and your family grows, starter homes tend to get a little . . . cramped.

But don’t hate on your current home too much. Because while it gave you a safe and dry place to lay your head at night, it was also setting you up to own your dream home someday.

We’ll show you how it all works and walk you through the steps that’ll get you in your dream home—one you can actually afford!

How to Get Your Dream Home in 5 Steps

Here are the steps:

Now let’s cover each step in more detail.

Step 1: Follow the Financial Basics

First thing’s first—you have to get out of debt, get on a budget, and build up an emergency fund of 3–6 months of expenses. Sounds pretty basic, right? If you haven’t completed these steps, then you’re not ready to upgrade to your dream home . . . yet.

Now, when you’ve got house fever, it can be hard to focus on paying off debt or saving an emergency fund before you upgrade your home—especially when you’re feeling the pressure of rising home prices and interest rates.

But whether it’s your second or third house, you should only buy a home when you’ve covered the financial basics we mentioned above. Then you’ll be ready to start the journey toward owning your dream house.

And that journey starts with your home equity. What’s equity? Well, we’re glad you asked . . . that brings us to the next step.

Step 2: Find Out How Much Equity You Have

Home equity is a pretty simple concept: It’s your current home’s value minus whatever you still owe on your mortgage.

See, in most cases, your home’s value increases over time. Similar to other long-term investments (like retirement accounts), homes gradually increase in value. There have been periods of ups and downs in the market to be sure, but the value of real estate has consistently gone up. According to the St. Louis Federal Reserve, the average sale price of a home has increased over 2,300% from 1965 to 2023! And in the last ten years (2013 to 2023), there’s been a 68% increase.¹ As your home increases in value, so does your equity. In real estate terms, this is called appreciation.

Other factors that increase your home’s equity include:

Added value: Home improvement projects like adding square footage, updating fixtures and appliances, or even just slapping on a new coat of paint can add value to your home.
Mortgage paydown: Paying down your mortgage not only gets you out of debt faster, it also builds your equity. The less you owe on your home, the more equity you have.

The amount of equity you have gives you a pretty good idea of how much money you’ll end up with after selling your house. You can use that money to make a hefty down payment and cover the other costs that come with buying a home.

Find expert agents to help you buy your home.

So, how do you determine your home’s value? Well, you can get a ballpark estimate on real estate websites like Zillow, ask a trusted real estate agent to perform a competitive market analysis (which they’ll do anyway if they’re helping you sell your house), or get a professional appraisal.

Finding out your home’s equity will involve a little math, but it’s third-grade-level stuff, so don’t sweat it.

Here’s what we mean. Let’s say your home’s current value is $355,000. When you sell that house, you’ll have to pay for between 1–3% of the sale price in closing costs, another 6% in fees for the real estate agent who helped you sell it, and whatever’s left to pay off on your mortgage.

That means you can estimate clearing over $223,000 from selling your house. That’s a killer down payment on your dream home! And if your home is paid off, that’s even more money to put down and use to pay for things like repairs and moving expenses.

Step 3: Set Your Dream Home Budget

Once you know how much you’ll clear from the sale of your home, you can start making a budget for your dream home.

The key to owning your dream home (instead of it owning you) is to keep your mortgage payment to no more than 25% of your take-home pay on a 15-year fixed-rate mortgage, along with paying a down payment of at least 20% to avoid private mortgage insurance (PMI). Never get a 30-year mortgage even if the bank offers it (and they will). You’d pay a fortune in interest—money that should go toward building your wealth, not the bank’s.

So, let’s say your take-home pay is $4,800 a month. That means your monthly mortgage payment shouldn’t be any bigger than $1,200. By the way, that 25% figure should also include other home fees collected every month with the mortgage payment like homeowners association (HOA) fees, insurance premiums and property taxes.

Plug your numbers into our mortgage calculator to see how much house you can afford.

And don’t forget to budget for all those other costs that come with the home-buying process in addition to your closing fees—things like moving expenses and any upgrades or repairs you might need to make. You don’t want these hidden costs to catch you off guard or drain your emergency fund.

Step 4: Find the Right Dream Home for You

This is where things get real. After all your hard work building up your equity (and doing a lot of math—don’t forget that), you’re finally ready to start the house hunt. Woo-hoo!

But don’t lose focus. Stay zoned in by making a list of features that make a home fit your budget, lifestyle and dreams—and stick to it throughout your house hunt. Here are a few ideas to get you started.

Don’t compromise on location and layout. If you plan to be in this home for the long haul, an out-of-the-way neighborhood or a wacky floor plan is a deal breaker. Look for a community and layout that’ll suit your lifestyle now and for years to come.
Think about how much space your family needs. While your budget has the final say about how much home you buy, you’ll want your dream home to fit your family’s needs through different life seasons.
Consider the school districts. If you have or want kids, the quality of the nearby school districts is probably already on your mind. But even if you don’t have kids or you’re retired, keep in mind that having good schools nearby could increase your home’s value.
Look for a house that’ll grow in value. Are home values rising in the area? Is the number of businesses going up? These factors can help you figure out whether your dream home will turn into a good investment.
Count the costs. Want that fancy master bathroom with the multiple showerheads and the Jacuzzi tub? Be clear on what’s a must-have and what’s nice to have. And don’t forget, upgraded features like that will make your dream home more expensive.

Step 5: Be Picky and Patient

We know you’re anxious to get into those new digs, but be patient. Wait for the right house at the right time. Don’t spend your money on a less-than-ideal home just because you’re tired of looking.

The key is finding a good real estate agent who understands your budget and refuses to settle for “good enough.” They’re as committed to your dream as you are and will have your back throughout the entire process, no matter what it takes.

In addition to teaming up with a great real estate agent, you can take a couple of extra steps to make sure you’re ready to strike as soon as the right home comes up:

Get preapproved for a 15-year fixed-rate mortgage. Having preapproved financing is a green flag for sellers—especially in multiple offer situations. And because this puts most of your information in the lender’s system, you’ll be on the fast track to closing once your offer is accepted.
Offer earnest money with your bid. Earnest money is a deposit to show you’re truly interested in a home. Usually it’s 1–2% of the home’s purchase price and it’s applied to your down payment or closing costs. Even if the deal falls through, you can almost always get most of it back.

Find a Real Estate Expert in Your Local Market

Now, you might be thinking you have some work to do before you’re ready to find your dream home. Or you may be realizing your years of hard work are about to pay off! Regardless, if you follow these steps, you’ll find the house you’ve always wanted and avoid a purchase you’ll regret.

Once you’re ready, connect with one of our RamseyTrusted real estate agents. These are high-performing agents who do business the Ramsey way and share your values so you can rest easy knowing the search for your dream home is in the right hands.

Find the only real estate agents in your area we trust, and start the hunt for your dream home!

Jason Momoa Stuns the Internet with Photos of His New Girlfriend—12 Years Younger

Jason Momoa’s new relationship is making news after he shared photos of his famous girlfriend.

Fans are noticing that she looks a lot like his ex-wife and their child, which has sparked reactions online.

Some people are uncomfortable, saying that his girlfriend resembles his teenage daughter.

Jason Momoa confirmed that he is dating again. When photos of his new girlfriend surfaced on social media, fans began comparing her to his family. Some believe his ex-wife is more beautiful, while others find it unsettling that his new girlfriend looks similar to his daughter.

Jason Momoa is best known for his lead role in the 2018 film *Aquaman*, where he starred alongside Amber Heard. The two returned to their roles in the highly anticipated sequel, released five years later in 2023.

Jason Momoa was previously married to *The Cosby Show* actress, Lisa Bonet, and the two were seen as a power couple in Hollywood. Their relationship began in 2005 after they were introduced by mutual friends, and they quickly became a beloved pair in the public eye.

At the time, Lisa Bonet, who is 12 years older than Jason Momoa, was a single mother raising her teenage daughter, Zoë Kravitz. Zoë is Bonet’s daughter from her previous marriage to musician Lenny Kravitz. Despite the age difference and family dynamics, Momoa and Bonet formed a strong bond that made them one of Hollywood’s favorite couples.

Through his relationship with Lisa Bonet, Jason Momoa developed close bonds with his stepdaughter, Zoë Kravitz, and her father, Lenny Kravitz. Momoa affectionately calls Zoë “Zozo bear,” while she refers to him as “Papa bear.” Momoa has also spoken highly of Lenny Kravitz, expressing deep respect for him, and that admiration is mutual. Their blended family dynamic has often been praised for its warmth and mutual respect.

Jason Momoa, best known for his role in “Baywatch,” and Lisa Bonet officially tied the knot in October 2017 after more than a decade together. The couple welcomed two children during their relationship: daughter Lola and son Nakoa-Wolf, who are both teenagers now. Despite their eventual separation, the family remains in the public eye due to their close bond and co-parenting.

In a 2018 interview, Jason Momoa expressed his deep admiration for his marriage with Lisa Bonet, sharing how much he enjoyed their relationship. He revealed a side of Bonet many people might not know, saying, “Not a lot of people know how absolutely hysterical she is. She makes me laugh and is just really quirky.” His affectionate words highlighted the playful and humorous connection they shared throughout their time together.

The Hawaii native, Jason Momoa, also spoke highly of Lisa Bonet as a devoted mother, saying, “My wife is amazing. Her ultimate art form is being a phenomenal mother.” He admired her parenting skills and how she balanced life with their children. Momoa further emphasized their strong bond by describing their relationship as a “perfect fit,” showing the deep connection they shared as partners and parents.

“The love between us carries on, evolving in ways it wishes to be known and lived. We free each other to be who we are learning to become,” the couple shared in their joint statement, announcing their separation. Their breakup sent shockwaves among fans, as they had been seen as a strong and loving couple.

Later, an insider revealed that their split was largely due to differing lifestyles and priorities. While Momoa was focused on his booming career and travel, Bonet preferred a more low-key, grounded life, which eventually created distance between them.

“Jason is very focused on his career and wants to work. He has found success and it’s driving him and is very fulfilling. Lisa wants to be in LA and is not interested in going on location for long periods of time with him,” the source disclosed.

According to the insider, Bonet’s priorities shifted as she focused more on health and wellness, which motivated her. Since Momoa’s lifestyle didn’t align with hers, they eventually grew apart and began seeking different things.

Two years after announcing their split, Bonet officially filed for divorce in January 2024. She cited irreconcilable differences and listed October 2020 as the date of separation.

The Superior Court of California approved the divorce filing the day after Bonet submitted it. The couple had reportedly agreed on the terms of their divorce before filing, and were granted joint custody of their children. Neither child support nor spousal support was awarded.

Since the breakup, Momoa has found love again with another well-known Hollywood figure. The 32-year-old woman is also a divorcee. She was previously married to lawyer Edgardo Carnales, whom she wed in July 2019.

However, the pair, who kept their romance private, divorced in June 2023 after over three years of marriage. She listed their separation date as January 2023 and requested that both parties’ rights to support be terminated.

She once praised her famous father in an interview, saying, “He motivates me and pushes my limits, making sure I’m always growing as an artist.” Before hitting it big in Hollywood, Arjona worked as a waitress and hostess in New York City.

At the time, she was studying acting at the Lee Strasberg Theatre and Film Institute. She reflected, “I learned the value of money and working hard. It helped me because I got used to being on my feet. And I think today I can handle 16-hour days thanks to my experience as a waitress.”

The Hollywood star shared, “I have a mother who is extremely spiritual and positive. She guides me through every obstacle in my life.”

This was when the “Game of Thrones” actor went public with his new relationship with Puerto Rican actress Adria Arjona. Arjona, who is 12 years younger than him, was featured in several of his photos. In one of the pictures, she was smiling while sitting on his lap.

“She actually looks like his ex-wife Lisa Bonet, just younger,” wrote one person. Another user agreed, saying, “Looks like a younger Lisa.”

Arjona has starred in movies like “Pacific Rim: Uprising,” “Hit Man,” “Father of the Bride,” and “Triple Frontier.” Besides their shared passion for acting, she and Momoa also bond over another mutual interest.

Adria Arjona and Jason Momoa’s relationship continues to capture the public’s attention. As they share more glimpses of their life together, fans are excited to see how their love story unfolds.

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How to Own Your Dream Home