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Source: Houston Real Estate Examiner | November 14, 2009

This post is geared for newbies, as well as homebuying veterans who may need a brushup on the basics. Most of these tips come from Eric Bramlett, a real estate broker out of Austin, Texas.

1) Decide whether it's time to move.

Weigh the cost versus the benefit. Are you planning to stay for at least three years in your new home? If your answer is ‘yes’ then you should go ahead and buy. You will be at a break-even on your closing costs after two years and start making money at year three.

2) Home = Money Machine.

After year three, you can really experience the benefits of appreciation.

3) The first step - Pre-approval

Get pre-approved for a loan. This is the scariest part for many buyers, but pre-approval is a very important step. Pre-approval gives you buying power and allows you to make a solid offer on your dream home when you’ve found it. A pre-approval letter also makes the seller more likely to accept your offer.

4) Learn your total housing costs

Pre-approval also lets you know how much your new home will REALLY cost—in monthly payments. A $650,000 or $800,000 home price can be an abstract concept, but $3,000 a month or $4,500 a month are tangibles that everyone can understand. When you meet with a lending professional (call me at 415-577-0809 for the names of some great ones) ask them for a “payment table” that shows you a rough estimate of your TOTAL monthly payment, including taxes and insurance or homeowners fees based on purchase price. Pick your payment and you know the price range to shop in.

5) Call a good Realtor

I know this sounds self-serving, especially when you can find just about every home for sale online, but a good agent will take the spam out of your property showings. I also make it my business to track the market 24/7 and take pride in putting my buyers into carefully selected properties that will hold their value in the short term and offer excellent appreciation in the long term.

6) Hang tough on negotiating terms and price

I’ll also go to the mat for you when negotiating price and terms to make sure you don’t overpay and protect your interests. With the average real estate file running 100 pages or more, one tiny mistake or omission could land you in court or cost you thousands. Having a Realtor handle the paperwork not only eliminates the headache, it also limits your financial and legal risk.

7) The “wants and needs in a home” exercise

Make a list of “Must Haves” and “Wants.” Your search will be easier and you’ll be more confident in your decision if you take a systematic approach. The best way is to make two lists: Your “must haves” and your “wants.” Your “must haves” are the essentials: parking, bedroom/bath count, square footage and the unique odds and ends like room for your kayak or big walls for your art. Your “wants” are the qualities that you would like for your new home to have, but can live without. Great examples of “wants” are hardwood floors, a gas stove, and type of exterior. By taking the time to articulate what you need and want in your new home, you will know exactly what to look for when looking at prospective homes.

8) Figure out the best neighborhoods for your needs

Learn the neighborhoods. The variety of home styles and neighborhoods is astonishing in San Francisco. You can buy a mid-century house in Midtown Terrace, an Edwardian flat in the Western Addition or a sleek apartment condo in South Beach. Sometimes I like to put my buyers in a car and drive the neighborhoods. It gives them an opportunity to learn some of the City’s geography and get a feel for the different areas. You can also read about San Francisco neighborhoods on my website.

San Francisco also has micro-neighborhoods, where housing styles and neighborhood character change within the space of just a few blocks. The 700 block of Waller is vastly different from the 300 block, for example. Weather is also a big consideration. If you’re a sun worshipper, some neighborhoods, like the Outer Sunset, are out of the question.

9) Be a buyer, not a browser

Beware of the “Red Shoe Experience.” This tip comes from Elizabeth Weintraub, of Lyon’s Realty in Sacramento. Women will relate to this. Say, you need a new pair of red shoes. You go to the mall. At the first shoe store, you find a fabulous pair of red shoes. You try them on. They fit perfectly. They are glamorous. Priced right, too. Do you buy them? Of course not! You go to every other store in the mall trying on red shoes until you are ready to drop from exhaustion. Then you return to the first store and the red shoes are gone. Do not shop for a home this way. When you find the perfect home, buy it.

10) Make your decision!

This tip is a corollary to the Red Shoe Experience. Homebuyers often hesitate after they’ve found the right home because they’re not confident about their decision-making process. Your home is probably the largest investment of your life, and it’s normal to feel those butterflies. However, if you have followed the steps above, you will have your bases covered. If you’ve found a home that meets all of your “must haves,” most of your “wants,” is in the right neighborhood, and in your budget - it’s the one for you! Don’t wait and let another buyer take YOUR home!