Buying your first home is an exciting and challenging process. Some of the details can be intimidating for a first time buyer, but there's no need to panic. With a little preparation you'll feel like an expert and you'll be ready for anything!
The Early Bird
First, make a timeline. How flexible are your deadlines? Are you currently in a lease or can you buy as soon as you find the right house? Do you have money set aside for a down payment, or will you be planning the finances from scratch?
Get out a calendar and note any key dates over the next several months that may influence your search for a new home. Will you be away on vacation at any point? Are you expecting a raise that could help you qualify for a higher loan or a better interest rate? Add new dates and deadlines to the timeline at every step of the way.
Circle the date you imagine moving into your new house, then flip the calendar back six to eight months -- there's your starting date. If that date is already in the past, no problem, all of the conversations you've had and articles you've read up to now are part of the process, too. And don't worry -- you won't be wandering around looking at houses for six months. A motivated buyer can find a home within a couple of weeks, and it may only take another few to get to the closing table. The rest of this time will be spent learning the ropes.
Location, Location, Location!
The most important decision you will make is where to buy your home. Speculation on up-and-coming neighborhoods, urban revitalization, and the rise and fall of the real estate market can make buying a house feel like gambling in Las Vegas. Don't be intimidated -- simple common sense is all you need to decide where to buy your home.
If you are familiar with the general area you plan to buy in, you probably already know the reputations of some of the neighborhoods and suburbs. If you're moving to a new area, you'll want to do some research. Convenience to work, shopping, and other amenities is a primary issue as well. Convenience to public transportation, when available, is also a useful consideration.
Naturally, the cost of homes in different areas is most important of all. Many experts recommend picking the best possible neighborhood first, then finding an affordable home in that area. If you have kids or plan to have them soon, this principle can be especially useful in accessing the best local schools.
Show Me the Money
As early as possible, find out what kind of home loan you qualify for. Discuss the amount as well as the potential interest rates. Get to know a couple of different lenders and compare the information you get from each. Calculate the expenses related to different price ranges and decide what is reasonable for you - your idea of what you can afford might be different than the lender's. There are many books and websites devoted to calculating budgets for home buyers, so it's not too hard to come up with a reasonable financial plan.
Meanwhile, read plenty of articles and stay current on news stories relating to the housing market. The more informed you are, the more you can use the changing states of the market to your advantage.
Also remember that the housing market, like any industry, has a busy season (primarily spring) and a slow season (usually around the winter holidays). The busy season offers better selection but the quiet season may offer better bargains.
Hit the Books
The Internet is an amazing source of information. Property tax histories, regional crime statistics, and a wealth of homes for sale can be viewed online. The Internet can also be overwhelming. Many websites are run by commercial companies with an interest in promoting homes in particular communities, or lenders who will insist their program is the best deal for you.
It may sound old-fashioned, but to be a truly well-educated consumer you might want to read a book or two. Books undergo more rigorous fact-checking than magazine articles or web pages. Since they don't contain advertising, they are more likely to be impartial. Books are also written with specific consumers in mind, so it should be easy to find a couple that conform to your specific situation. Once you've learned the basics, you can use the internet to fill in the gaps and update any outdated statistics.