The first step for a new home buyer is to find out what you can afford to pay for a home or condo. This will depend on the amount of your assets (cash, income and credit).
Find out from your lender what kind of letter they can provide you with and what you have to do to get a preapproval letter. Presently in the financing of a new home it is not as easy to get a preapproval letter from your mortgage broker. In January of 2010 HUD began requiring lenders and mortgage brokers to issue a binding Good Faith Estimate within 3 days of receiving a loan application. Without a formal loan application many lenders today will issue only a prequalification letter, which does not carry the same weight as a preapproval letter. A preapproval letter gives added weight to your offer in case there are multiple offers.
Search for a good Real Estate Agent to represent you. Ask friends and family for recommendations and then interview several agents. A Real Estate Agent can provide you with good information on neighborhoods and where you can afford to buy and help with contract negotiations.
Buy in the best neighborhood you can afford without financially overextending yourself. Don’t buy a home that you will outgrow in a year or two. You don’t want to have to sell when prices are declining.
Buy a home with good resale potential. Try to find a home that has a broad appeal in a sellable neighborhood and that way no matter the market, it will improve your chance for a good resale.