There are obvious decisions that need to be made before embarking on a home purchase. How much can you afford to pay? How much do you feel comfortable paying? Which neighborhoods offer the kinds of homes and amenities — like good schools, shops and transportation nearby — that you want? How secure is your employment? Do you have enough cash reserves for emergencies?

In addition to these practical considerations, you should find out as much as possible about the local area. Does it have a strong and diversified economic base? Is employment improving or are employers laying workers off? Are businesses moving into or out of the area?

Are new facilities planned that will impact the community, like a freeway that might change the character of a neighborhood by creating unwanted noise. This could negatively impact property values.

There are obvious decisions that need to be made before embarking on a home purchase. How much can you afford to pay? How much do you feel comfortable paying? Which neighborhoods offer the kinds of homes and amenities — like good schools, shops and transportation nearby — that you want? How secure is your employment? Do you have enough cash reserves for emergencies?

In addition to these practical considerations, you should find out as much as possible about the local area. Does it have a strong and diversified economic base? Is employment improving or are employers laying workers off? Are businesses moving into or out of the area?

Are new facilities planned that will impact the community, like a freeway that might change the character of a neighborhood by creating unwanted noise? This could negatively impact property values.

However, a new rapid transit station under construction within walking distance of where you want to buy could make commuting to the closest urban center easier. This might have a positive impact on local property values and cut your commute time considerably.

HOUSE HUNTING TIP: Residential real estate is a localized business. Home prices differ from one area to the next. State laws governing home-sale transactions also differ. Federal law requires sellers to disclose lead-based-paint hazards. But, state laws differ on whether or not sellers need to disclose other defects, like a drainage problem. Many states have mandatory seller disclosure requirements. In other states, seller disclosures are voluntary, not mandatory.

Agency relationships also vary from state to state. For example, dual agency, where one broker represents both the buyer and seller, is illegal in many states. It’s legal in others. In states where dual agency is legal, like California, the broker has a split loyalty to the buyer and seller.

However, in states like Massachusetts, Michigan and North Carolina, designated agency is an option. With designated agency, both buyer and seller are represented by the same broker, but by different agents. Each agent owes loyalty to the party he or she is representing.

It’s important that your real estate agent explain the different agency relationships recognized in your state, particularly if you’re coming from another state where different agency relationships are recognized. You should also find out how much disclosure about property defects you can expect to receive from the sellers. You should always have a property you’re considering buying thoroughly inspected by qualified professionals. Include an inspection contingency in the contract even if the sellers have provided presale inspection reports.

Local point-of-sale ordinances can affect some cities in a state and not others. For example, in the San Francisco Bay Area, the cities of Alameda, Albany, Berkeley, Kensington and El Cerrito have had sewer lateral ordinances for several years. These have required sellers to have the sewer line between their homes and either the street or the city main line checked with a video camera. If there are defects, the seller is responsible for having repairs or replacement of the line complete before selling.

Starting Jan. 1, 2011, Oakland, Piedmont and Emeryville, Calif., will also have sewer lateral ordinances that require sellers to have their sewer lateral lines in good condition before the home is sold.

Work with a knowledgeable, experienced local real estate agent that can inform you about issues, statutes and ordinances that will affect you when you buy or sell a home in the area. Many real estate companies require buyers and sellers to sign generic disclosures, sometimes 10-18 pages long, covering such things as ordinances, disclosures and agency laws, rent control and schools.

THE CLOSING: Be sure to read these and ask your agent if you have any questions. Most buyers and sellers don’t take the time.

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