• Stay within your budget. Keep in mind how the home purchase will affect your existing financial situation and other goals, such as saving for retirement or funding a child's college education. You'll also need to consider the cost of living in the new home, such as utility bills, heating expenses and repair and maintenance costs. And don't forget to reserve enough cash to cover the closing costs, insurance premiums, property taxes and moving expenses.
  
• Decide what type of agent to work with. Although the seller's broker will be available to you, remember that he or she represents the seller. You may want to hire a buyer's broker to help you get the best deal. Ask the local Board of Realtors for a referral.
  
• Consider the asking price. To make sure you're not paying too much, objectively ask yourself how much the house is worth. Will you end up paying extra for features such as extra bedrooms, a pool or sauna that aren't important to you? Check the selling price of comparable homes in the neighborhood for recent trends.
  
• Have the home professionally inspected before you sign on the dotted line. A good inspection will reveal major problems, such as corroded plumbing antiquated or unsafe electrical systems, or structural or foundation problems. An inspector may also discover less serious problems, like minor electrical defects or inferior ventilation. If the house is safe and sound, the cost of an inspection will buy you peace of mind. Ask your real estate agent, friends or mortgage lender for a referral to a home inspection professional, or look in the Yellow Pages under Home Inspection Service.
  
• Get to know the neighborhood. If you have children, check out the schools they'll attend. Drive or walk to the nearest grocery store and shopping mall, and consider your daily commute. Make sure you don't mind these trips, because you'll be making them regularly for years to come.
  
• Look at the surrounding areas. To avoid unpleasant surprises in the future, envision possible changes in the neighborhood. Beware of imminent modifications if wooded areas are being developed or streets are being widened. You may want to check with the local planning department to see what developments might be permitted down the road, and how assessments could possibly affect you.
  
• Don't let your heart rule your decision. A new home is a significant investment, and looking at the pros and cons objectively may help you make the wisest choice.
  

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