1. Is buying a house a good investment?

If you are looking at a house to live in, this is probably the wrong question to ask. While homeowning can be a good investment in some ways, it should not be seen solely in terms of investment. The more important point about ownership is that it gives you control - you no longer have to worry about your landlord presenting you with a large rent increase or an untimely notice to vacate. Homeowning puts you in the driver's seat, allowing you to choose the kind of house you want to live in.

Investment is an entirely different story. Profit from real estate investment comes from choosing properties to buy, not from selling. But, this means that you can't be too fussy. The kind of house that makes a good investment is generally not the same kind of house as you would want to live in. You would need a great deal of luck to have the home you were looking for be the kind of bargain that investment requires.

2. Should I buy a house on the Internet?

Buying a house is not the same as buying a book, or even a car, and is normally not suited for internet purchasing. Being on location is very important - houses are not the kind of things that are purchased without a close physical inspection.

This doesn't mean that the internet can't be a great resource, only that it should not be the only one.

Internet searching can currently save you time, effort, and possibly even money, but you probably need more than the average browsing skill to get any significant value from it. The benefit will only increase as the Internet matures, though likely never to the point that it will replace other resources entirely.

3. Should I get pre-approved for a loan before I select a real estate agent/company?

Not necessarily. Selecting a loan officer after a real estate agent allows you to use the expertise of your agent to help choose a loan officer. While loan officers are beholden to agents as a major source of leads, the reverse generally isn't true. This allows agents to be more objective in their suggestions than loan officers would be.

4. Should I buy with a "full-service, one stop" real estate company?

Most likely not. It is rare to find a package deal with the same price and service as what you could find if you shopped for each service individually.

As noted columnist and real estate attorney Benny Kass says, “I do see a dangerous, anti-competitive trend on the Internet, toward ‘one-stop shopping.’ A potential home buyer can get a mortgage loan, have the house physically inspected, get hazard insurance and go to settlement - all with the same company. In my opinion, this is not in the best interests of the consumer. Consumers should comparison - shop for everything in real estate - from mortgage loans and hazard insurance to settlement services.” - Washington Post, 1/8/00.

5. Should I select a real estate company or an agent first?

The agent. The agent is the person you will be dealing with most of the time. You won't be dealing with "the company" all too often.

6. Should I work with a buyer's broker?

Working with a buyer's broker will actually help you save money in the transaction. Unless otherwise agreed upon, the listing agent works for the seller. While that agent still has to treat you fairly, they will still be trying to help the seller sell the house for as much money as possible.

Also, buyer's brokers' commissions are currently paid by the seller. While this might change in the future, until such time, what do you have to lose by using a buyer's broker?

Remember to select the buyer's broker with the same kind of care that you would use in selecting a listing agent if you were a seller. Generally, the higher the selling price, the more commission the buyer broker gets, while the same person is trying to get you the house for less money. It's not perfect, but it can work if you choose the right person.

7. Should "experience" be my main criteria in selecting an agent?

Experience is an important criteria, but experience alone shouldn't be the only thing you consider. Someone who can create opportunities for you might be better than someone who has years of experience doing the same transaction. And if you do use experience as your most important criteria, remember that the same amount of time spent doing something does not equal the same amount of experience.