1. Decide On What Matters
Whenever shopping for such an important lifestyle item as a house, it is important to first consider what you value most. For instance, is it more important that your kids are able to attend a great school, or that you have a minimal commute to your work? Is being able to entertain important to you? If so, you will need more space. Think hard about your day-to-day lifestyle and the kind of life you want to live in your new home, and make a list of priorities for your next house.
2. Learn the Neighborhoods
If you already know what city you want to live in, start test-driving neighborhoods to find some that really stand out to you. This step of the process can be enjoyable, for example, you can go to these places to run your normal errands, such as visiting the coffee shop to get some work done, buying groceries at the nearby store to check out their selection and prices, and maybe even buying a day-pass at the local gym, if you are into that kind of thing. Try to envision what your life would be like in each candidate neighborhood.
3. Get Organized Financially
Today's lenders tend to be particularly scrutinizing. Although it is a good thing banks can no longer dole out loans to people with no means to afford them, the tighter restrictions also make it harder for first time home buyers with little cash to buy a house. Start monitoring your credit now, and doing things to improve your credit, such as pay down some of your debts. Also, avoid extra expenses, such as a new car, while in the market for a new home.
4. Set Your Budget
One of the most important factors about your new home is simply, whether you will be able to afford it month-to-month. In general, your housing payment should be one-third or less of your monthly income. It is far better to live in a modest home without financial burden, than to live in a McMansion you cannot afford. That being said, a ten thousand dollar increase in the purchase price of the home yields only a $40 increase in your monthly mortgage payment, on average.
5. Do Not Rush
Buying a home is a scary, emotion-fraught process, and one of the biggest financial decisions some people ever make. For this reason, it is important to always keep a calm, cool demeanor when thinking about your housing options. While it can seem stressful or grueling, try to see as many houses as you can so that you can have a more objective view of the market and the houses you see. In other words, avoid settling for the first thing that comes along.