Full Article Link: Realtor.com – We Asked AI How Much Is Needed To Buy a First Home and Fact-Checked It With Financial Experts
Quote from Stephan Shipe
“Buying a home often leads to ‘lifestyle inflation.’ You’re going to want new furniture, nicer decor, upgrades. AI doesn’t always pick up on those human tendencies.”
—Stephan Shipe, Founder of Scholar Financial Advising
Key Takeaways
- AI Provides a Solid Starting Point, But Not the Full Picture
ChatGPT can help first-time buyers estimate homebuying costs like down payments and closing fees. But experts caution that its calculations are generalized—it can’t see your actual income, debt, or spending habits, which are critical to accurate planning. - Down Payments Can Start at 3%, But Context Is Key
AI estimated 3% to 20% for a down payment on a $300,000 home—$9,000 to $60,000. Financial experts note that 3% is realistic under certain loan programs, but it depends heavily on credit, loan type, and location. - Closing Costs and Prepaids Add Up Quickly
Expect another 2% to 5% of the purchase price for closing costs—roughly $6,000 to $15,000 on a $300,000 home. Prepaid items like property taxes and insurance often go into escrow, and vary widely by region. - What AI Often Misses: Lifestyle Inflation and Hidden Costs
According to Dr. Stephan Shipe, the real financial stretch comes after the home is purchased. Many buyers don’t budget for furniture, upgrades, or the subtle shift in spending habits that comes with owning a home. “AI doesn’t always pick up on those human tendencies,” he says. - Emergency Funds Matter More Than AI Can Express
Shipe emphasizes that new homeowners should aim to have six months of living expenses saved post-purchase, plus a buffer for unexpected repairs. Draining your entire savings to buy a house may leave you vulnerable. - AI Is a Tool—Not a Financial Plan
While ChatGPT is useful for outlining rough estimates, it can’t replace a real plan tailored to your goals, timeline, and financial tradeoffs. A fiduciary advisor can help build a personalized roadmap that goes beyond AI’s default calculations.