Do Your Research

When you decide the time is right to purchase a new home, it's always best to keep your emotions under control. Don't let your emotions take control and allow you to make a costly mistake.

The first step is to do your research. Investigate the current market conditions, and it will always be to your advantage to understand the market. Is it a seller's or buyer's market? In a seller's market the demand for homes in that area is high while the supply is low. In contrast, in a buyer's market the demand is relatively low and the supply is high. Further, in a seller's market, you might make an offer at the full asking price or even higher.

You're more likely to have to contend with competing offers in a seller's market. You'll have the most leverage to negotiate in a buyer's market. Your research should include homes that have recently sold in the same area as the home you're considering.

Also, try to discover the seller's motivation to sell. If selling is a necessity for the seller then you'll have more leverage during negotiations.