• Who is controlling the market place? Is it a buyer's or seller's market?

• How long are homes staying on the market?

• What time of year offers the best selection of homes?

• When are sellers or buyers most motivated?

• Do you want to pay market price or are you looking for a deal?

• How long do you plan on living in the home you buy?

• Is buying the right decision? Would renting and investing the down payment in other investments make more sense?

Buyer's market

In a buyer's market, sometimes known as a "slow market," you can be more leisurely in your search for a home. You have a better chance of negotiating price and terms in your favor. You may also have the opportunity to make a counter-offer several times until acceptable terms for both buyers and sellers are reached. Look for some of the signs of a buyer's market:

• Articles indicating a buyer's market in the local newspaper

• More homes are on the market than usual

• Homes are taking a long time to sell

• Home prices are being reduced in order to sell

• Sellers are offering incentives - such as bonuses or added commissions to selling agents, vacations, new carpet, paying some of the buyer's closing costs - to get buyers to purchase a particular home.

Seller's Market

The seller's market is also called a "hot " market. You can tell when it is a "hot" market by observing the following signs:

• Very few "for sale" signs in the area usually indicate that there is a small inventory from which buyers can choose

• There is more buyer demand for homes than there are homes on the market

• Several buyers compete to purchase the same home

• Homes sell very quickly

• Prices of homes are going up quickly

From a buyer's perspective, it can be very frustrating and discouraging to see homes that you are interested in sell before you can even make an offer. It is also frustrating to make a full-price offer and have another buyer, who offers the seller more, get the house, forcing you have to start searching for another home. The following tips should be considered in a seller's market.

• Find a real estate agent that will check the market for you frequently. This may mean your agent needs to check the multiple listing service three or four times a day.

• Get your financing in order and clean up your credit. Ideally, the buyer should be able to provide a pre-approved letter from his or her lender along with the offer.

• Be prepared to make an offer when you go to look at homes.

• Make your offer very attractive to the seller. In order to do so, keep contingencies to a minimum in order to assure a quick close of the transaction. A large down payment and a large deposit are also attractive to a seller.

• Use the Internet and other contacts to your advantage. RealAdvisor™ offers email notification of new listings that meet your search parameters.

• Have friends and family help in your search.