If you are buying investment property or a vacation home, chances are you've purchased real estate before, so you know what a fiasco it can turn out to be. Formulating a strategy before you even begin to look for a place is the ideal situation. So if you've already begun your search, take a step back and make sure your strategy meets your personal and financial objectives.
- Location is key. Remember that old adage "Location, location, location?" Well, it is true any time you buy real estate. If the location isn't favorable to you, then it likely won't be attractive to someone else either.
- Compare what you want to what you really need. Most of us would love to get everything we always wanted, but it may not be practical, especially in a home that we won't be using frequently or at all. See the section Choosing a Home and complete the Wants and Needs Checklist.
- Analyze what you can afford and explore financing alternatives. It is important to determine how much you can afford to invest in the property and the different options available to pay for it. You also want to factor in any rental income and expenses you might incur.