Your lifestyle: A large part of what determines which home and neighborhood is best for you depends upon your lifestyle. For a family with young children, a home on a quiet cul-de-sac where their children can ride bicycles without passing automobiles may be preferable to a home on a busy street. For another family, couple or person, being closer to work and other amenities that a city offers such as restaurants, art galleries, clubs and a coffee shop within a short walk of their home may be more preferable. Others may prefer a property that provides them easy access to the outdoors, such as a property that is close to parks or water.

House type: Understanding your lifestyle also can help determine what type of home you may want to consider. While many dream about the little cottage with a nice lawn on a quiet street, many first-time homebuyers are attracted to the convenience and ease of condominiums, town houses, and duplexes, which may be more affordable than a single-family home, and may be located in or near more urban areas, closer to shopping, restaurants and other amenities. Other first-time homebuyers desire their first home in a new development. Still others look at the opportunity of buying a real fixer-upper and earning their equity through sweat and many visits to the hardware store. Buying a home, regardless of what type it is, is more than just a financial transaction. It requires a commitment of time and energy to maintain the home and preserve or enhance its value.

Location, location, location: As you look through the newspaper ads or look at homes on the Internet, it will become increasingly clear that a home that offers the same features, the same square footage and the same property size in one location costs more than the same home in another location.

Factors such as safety, school quality, and proximity to shopping and entertainment may contribute to demand for homes in a given neighborhood. Other questions to consider include: How far are you willing to commute to work? How close do you want to be to family and friends? Do you have young children who would enjoy a nearby playground? Picturing your day-to-day life in a certain neighborhood is a good way to predict whether you will feel comfortable there.

Condition of a home: As you walk through open houses, pay close attention to the condition of the home. Is it in good condition or will it need to be repaired or changed to fit your tastes? One place to start in understanding the condition of the home is its mechanical features, such as the age and condition of the heating, cooling, electrical and plumbing systems. Then, you might consider the condition of rooms, such as the flooring, the doors and the walls. The condition of the exterior also is important - the roof, siding, windows and even the walkways. But don't stop there. Take a close look at neighboring homes - are they being kept up? Are your neighbors adding onto their homes? Do they keep their yards clean? All of these factors not only determine the fair market value of the home now, but also may play an important role in the future, when you want to sell your home.

Building a new home: If you've looked and looked for your dream home without success, or if you want to be the very first owner of a brand new home, consider building. You'll have more opportunity to customize the home's features and design, more up-to-date appliances and building materials, and usually a builder's warranty to cover problems that come up in the first year.

Resale value: Eventually, at some point in the future, you will more than likely sell your home. Because most first-time homebuyers often buy their homes when they are young adults, typically, they will sell their first home to move into a larger home to accommodate a career move or start a family. So, it's very important to consider how much you may be able to sell your home for, before you even set foot into your new home. This is called resale value. The neighborhood, schools, transportation accessibility and special features are characteristics that will all remain important when you sell your home, as will all of the other factors discussed above, as potential homebuyers looking at your house will likely be asking themselves the same questions you thought about when you first bought your home.

However, regardless of how desirable your house may be, changes in the economy or real estate market that are beyond your control may have more impact on your resale value than any other factor. For this reason, when you purchase your home, you should not assume that you will be able to later sell the house for the same amount you paid.