Introduction

Meet Your Adviser

Mark Nash, an Associate Broker with Coldwell Banker, who serves the Chicago, Evanston, Skokie, and Wilmette areas of Illinois (www.marknashrealtor.com).

The brakes are off, and you're ready to visit houses that seem to match your Dream List, and choose one. "Whatever you do, don't settle," says Realtor® Maxine Mackle (after 18 years of experience in the Connecticut market). "You should be really enthusiastic about a house before you make an offer on it."

But first, breathe deeply and cultivate some nonattachment. Sellers of beautiful houses usually know they've got a gem and price it accordingly. Meanwhile, the market contains its share of duds: houses with dark rooms, weird layouts, and repair nightmares. This doesn't mean your perfect house isn't out there, just that you're unlikely to find it on day one. So to make your search productive, we'll show you how to:

• get help from your real estate agent, friends, and neighbors
• compare each house with your Dream List, looking past the fancy furniture or staging, the need for fixing up, or the shininess of a recent remodel
• see whether you can live with the layout
• review disclosure and other information you receive from the seller
• do your own, informal inspection for repair issues, and
• understand how to approach buying a not-yet-constructed house, or one in a common interest development (CID).

How Your Agent Can Help

While you should take an active role in househunting, your agent's expertise will be invaluable in several ways.

Identifying appropriate houses. Using the Multiple Listing Service (MLS) database, your agent can access far more information than the general public (unless you work with a brokerage like ZipRealty, which gives its clients full access). Illinois Realtor® Mark Nash explains, "The MLS helps me tell buyers things like how long the house has been on the market, its current status ("active," "under contract," "sale pending," or "closed"), what its existing mortgage is, and more. I've had clients say, 'Don't call me unless something comes up within this one city block,' so I keep tabs on such things through the MLS."

No need for embarrassment, your agent has heard it all. Some agent's stories might as easily have come from a therapist: homebuyers they've counseled about whether to have children, couples whose divorces they predicted. Get used to your agent knowing your private concerns, but try to work out any disagreements on your own. A house visit isn't the place to argue about whether you need an extra bedroom for your mother-in-law to live in.

Apart from the MLS, the agent has been watching the market for longer than you and knows which houses' sellers aren't worth negotiating with, and which sellers are ready to drop their price. Houses coming up for sale may reach your agent's ears long before they're advertised. You'll be driving along and hear your agent say, "If you can wait another week, that house will be on the market."

Arranging showings. Your agent should take you to tour homes you're interested in -- more than once per house, if need be.

Helping evaluate houses. Another set of eyes can be a great help when visiting houses. Your agent may point out defects that you missed or possibilities you hadn't imagined. Just don't let your agent's judgment overtake your own. And don't be shy about visiting houses without your agent -- you can always bring the agent back for a second look. (And you absolutely should bring your agent back into the process when it's time to prepare an offer.)

And more. Some agents find creative ways to help. For example, home-buyers visiting from out of town may find their agent is willing to pick them up at the airport and make hotel reservations. Mark Nash keeps five umbrellas in his car for rainy days. And agents regularly work evenings and weekends, showing you houses, reporting back on houses they've previewed, and more.

Best thing we ever did
Visit open houses without our Realtor®. Although Pat and her husband loved their Realtor® (their second one, after they'd fired the first), she was extremely busy. And, says Pat, "We knew finding an affordable house in a good school district, with yard space for our children, wasn't going to be easy -- so we spent Sundays looking at every open house we could. By a stroke of luck, an agent at an open house told us that a nearby house would be up for sale soon. Its owner lived out of state and needed to sell in a hurry. Our Realtor® made some calls, and we put in a bid. On Christmas Eve, we found out that our bid had been accepted, and we got the house!"

The Rumor Mill: Getting House Tips From Friends

People planning to sell their house don't usually make a big secret out of it -- they tell friends and neighbors, long before they formally list the house. If you can tap into the same network (most likely if you already live nearby), you may find out about a house before it's up for sale.

Tell friends, neighbors, your hair stylist, the florist, your dentist, and more. Some home seekers even print up letters explaining exactly what they're looking for and promising a treat or reward to anyone who helps them find a house.

Planning Ahead for House Visits

Don't get too ambitious -- most buyers find that visiting between four and eight houses per day is all they can handle before their brains fry. To make the most of your visits, do some prep work. Make sure you've got not only the complete list of houses you want to visit and a map, but all the items on the House Visit Checklist shown below. (The Homebuyer's Toolkit on the CD-ROM also has a copy.)

While you're looking at a house, the seller's agent (and the seller if present) are evaluating you. Dress comfortably but professionally, without overdoing it. As Realtor® Mark Nash puts it, "A lot of bling or overdress means the seller or agent will think you can afford full price. You want to be well groomed, understated, and home-price-range appropriate. This is a business transaction -- don't give them a negotiating edge by allowing them to overread you."

If the house has a rental unit, never tell existing tenants what you will or won't do as owner. For instance, saying "I'll keep the rent low" could create false expectations, leading to later arguments. But be friendly, and ask tenants for information concerning roof leaks, sewer backups, break-ins, and more. Tenants may reveal things you'd never learn any other way.

Unless your child is small enough to carry in a sling or backpack, leave the kids at home for the first visit. Most parents can focus better without chasing a toddler or hearing choruses of "This will be my bedroom"/"No, mine!" You can (and should) get your kids' okay later. And this should go without saying, but don't bring your pets.

Come on In: What to Expect as You Enter

Okay, your feet are crossing the welcome mat, and you're getting your first peek inside. The agent is probably in one of the front rooms, happy to greet you and to answer questions. If you've made an appointment, either the seller's agent will let you and your agent in, or the agent will get a key from a lockbox. In rare cases (and with FSBOs), the seller will be there as well.

If it's really awful, you can leave! No need to be polite and do the full tour. While some aspects of a house can be changed, such as filthy blinds or old cabinets, trust your instincts and don't waste your time.

Picking Up the Paperwork

Your first task is to see what paperwork the sellers have made available to you. This might include a property fact sheet, with basic information like the house's size and amenities; a disclosure form that details what the seller personally knows about the condition of the house's features, appliances, and environment; and/or a pest report and possibly a general inspection report, including details discovered by a professional.

You probably won't get all three of these -- you may get none, or only the basic fact sheet or a flyer. How much information a seller is legally required to give potential buyers varies from state to state (though they may give more).

"As-is" on a fact sheet equals red flag. It normally means the seller wants you to buy the house without requesting payment for any repairs, perhaps without even doing a home inspection. Ask what it means to this seller.

First Questions to Ask

If the house looks promising, you and your agent should ask some basic questions concerning repair needs, utility costs, neighbors, and more. You'll most likely ask these of the seller's agent, but if the seller is there, or is selling without an agent, ask the seller directly.

See the "Questions for Seller Worksheet" in the Homebuyer's Toolkit on the CD-ROM. Tailor this list to your interests, for example, adding a question on whether there's hardwood flooring under any carpets. (Also, if you're buying a condo or co-op, the Toolkit contains a separate checklist for you.)

Do We Have a Match? Using Your Dream List

Even the "right" house probably won't be just as you imagined. Carrying your Dream List (with the first two columns filled out) will help you stay organized and avoid getting distracted -- for example, being so impressed with stainless steel appliances that you forget that one bathroom won't be enough. Fill out your Dream List before leaving each house. At the end of a day's househunting, when you can barely remember your own name, it will answer questions like, "Was it the brick house that had the patio?"

Get organized. Keep a file for each house that seems like a possible match. Include your filled-out Dream List, property fact sheet, and other paperwork.

All the World's Been Staged: Looking Past the Glitter

In the old days, you'd see houses for sale pretty much as the sellers lived in them -- with their furniture, dishes, and clutter. But the real estate industry has learned that by emptying out and then gussying up a place, with rented antique furniture, flowers, curtains, and more, buyers will be wowed into paying more -- often tens of thousands more -- for a home.

The resulting makeover job goes by the trade name "staging." And it's your job to look past it, to see whether the house has good bones or is just wearing a lot of cosmetics and concealer. To avoid being hypnotized:

• Figure out whether each room has all the furniture it needs. Stagers usually remove most of the owner's furniture and then bring in a select few pieces -- some smaller than normal. As you look at a bedroom, for example, picture it with your queen-sized bed, nightstands, and bureau, not the twin bed and delicate side table.
• Notice where flowers and knickknacks have replaced functional objects. In a normal laundry room, you'd expect to find detergent, laundry baskets, and a drying rack. Not in a staged house -- you're more likely to see a wicker basket filled with fluffy, lavender-scented towels.
• Observe what your eyes are being led toward -- and therefore away from. If the entry hallway is small and dark, you can bet you'll see a glorious display of flowers on a nearby table.
• See whether your stuff will fit into the closets and cabinets. With the owners having moved out their clutter, you might not immediately notice that there's no hall closet, linen closet, medicine cabinet, basement, or attic.
• Figure out what style the house is without the staging. Stagers can make a ranch house look like a Victorian, or a 1950s drab home look like an Arts and Crafts bungalow.
• Turn on all the lights, including table lamps. Stagers often set lamps next to beds or couches, even though there's no electrical outlet. A lack of outlets is a common defect in older homes. Also, check that kitchen and laundry appliances actually have a source of power and other connections needed for operation.
• And smell that apple pie. If the house smells dreamy or the music sounds divine -- well, someone made it that way. And they don't come with the house.

Staging isn't all trickery -- if it's well done, you might pick up some ideas for how you'd do up the place yourself. Just don't pay more than the house is worth simply because it looked gorgeous after the staging job.

Recent Remodels: What to Watch Out For

If you can afford a house that someone else has fixed up, great -- you can save a lot of effort and ongoing maintenance. But not all sellers have good motives, judgment, or taste. In particular, watch out for houses where the seller has:

• Never lived there, but fixed it up to make a profit. This is called "flipping," a popular investment strategy in hot markets. Unfortunately, since the seller had no personal stake in the house, you can't count on good materials or workmanship. If you get as far as making an offer, you'll of course hire an inspector. But before things get that serious, save yourself a heap of trouble by making sure the necessary permits were issued and getting an independent appraisal before relying on appraisal reports the seller shows you. Fraud cases involving flipping are surprisingly common, where the appraiser is in cahoots with a seller and overvalues the house based on superficial or low-quality improvements.
• Made fix-ups to suit unique tastes. Overcustomizing can be detrimental to a house's value, like if the seller was a sports fan who did the whole house in team colors. If you and the seller are kindred spirits, great -- but good luck finding the next buyer.
• Overimproved the house. A property can actually be made so fabulous that it's no longer comparable to surrounding homes. Unfortunately, surrounding homes set the standard for home values in that area. You might enjoy the house while you live there, but be prepared for slow rises in value and difficulty reselling.

Walk the Walk: Layout and Floorplan

The physical layout of a house can make a huge difference in whether you're comfortable living there. When visiting a house, imagine going through your daily activities. For example, "I'm opening the refrigerator -- it bumps the oven door, and I'll have to chop vegetables on this tiny countertop across from the sink."

Best thing I ever did Not buy the house with the weirdly placed bathroom. Kurt, an avid gardener, was close to bidding on a two-bedroom Victorian. He says, "It was on a corner, with a lot of garden space around it. I was already visualizing planting roses. The problem was, the one and only bathroom was stuck right between one bedroom and the kitchen. It just had a door on each side. Imagine being a guest and having to worry about locking both doors! I'm hugely relieved I held off."

What Do They Know? Reviewing Seller Disclosure Reports

One of the most important pieces of paper in this process is the disclosure report, which most -- but not all -- states require sellers to give prospective buyers. (Exceptions are sometimes made for certain properties, such as those in probate.)

Most state-required disclosures are made using a standard form, upon which the seller will check off features of the property and rate or describe their condition. If the house hasn't yet been built, the developer obviously won't have much to disclose -- but may still need to tell you about things like the type of soil; previous uses of the property; possible future uses of surrounding land; and the developer's intentions regarding existing trees, streams, and natural areas.

What you read may affect your decision whether to make an offer. To find out more about a topic mentioned in the form, ask for it in writing. And if you receive this form after making an offer, you can cancel the sale if you don't like what you read. Even after the sale has closed, if a problem pops up that you believe the seller knew about and didn't disclose, you can sue the seller on that basis.

Exactly when you're given the seller's disclosures varies by state. In a few states, such as Alaska, Kentucky, and New Hampshire, sellers must give you disclosures before you've made an offer. But most states don't require the seller to do this until after you've made an offer, often just before the two of you sign the purchase agreement.

What's in a Typical Disclosure Report

The typical disclosure form is a few pages long and describes features like appliances; the roof, foundation, and other structural components; electrical, water, sewer, heating, and other mechanical systems; trees, natural hazards (earthquakes, flooding, hurricanes); environmental hazards (lead, asbestos, mold, radon); and zoning.

Some disclosure forms also cover legal issues, such as ownership problems, legal disputes concerning the property, past meth lab usage, or community association fees. Strange but true, the forms might also require information about suicides, murders, and other deaths on the property; nearby criminal activity; or other factors, such as excessive neighborhood noise.

See the sample disclosure forms in the Homebuyer's Toolkit on the CD-ROM. They're from Indiana and California, representing a range between short and long versions of the form. (California's disclosure laws are among the most demanding in the country and require sellers to also fill out a Natural Hazard Disclosure Statement, also included.)

Understanding Your State's Disclosure Requirements

Disclosure requirements vary among states, and some sellers try to wiggle out of the requirement altogether. Your agent should make sure the seller complies with the law -- but the question will remain, how much did the law require the seller to tell you about in the first place? If the standard form doesn't mention past flooding, the seller doesn't have to, either (but shouldn't lie if asked). You might want to read your state's law, or at least the form, to look for holes.

As of this printing, the only states that don't require sellers to either fill out a disclosure form or disclose material facts about the property are Alabama, Arkansas, Colorado, Florida, Kansas, Massachusetts, Missouri, Montana, New Jersey, New Mexico (except for condos), North Dakota, Utah, Vermont, West Virginia, and Wyoming. New York state is unusual, in that sellers of single-family homes can choose not to fill out a disclosure form and give the buyer $500 at closing (which many do). And New York sellers of co-ops and condos need disclose little more than their knowledge of any lead and asbestos, the percentage of ownership or unit shares, and the amount of their monthly charges.

But even in nondisclosure states, buyers can negotiate to make seller disclosures a part of their purchase -- or may get them without asking. In Massachusetts, adviser Nancy Atwood says, "Our MLS listings tell us whether the seller is providing a disclosure form. Most sellers know that if they don't, the buyers will think they've got something to hide." Beyond these possibilities, "It's buyer beware," says New York attorney Richard Leshnower.

To find your state's law, talk to your real estate agent or state regulatory agency. You can find yours at www.arello.com/RegAgency.cfm. Or you can search online for "real estate disclosure," "disclosure form," or "disclosure statement" and the name of your state.

Buying a house built pre-1978? By federal law, the seller should, before you buy, give you a form disclosing whether there might be lead-based paint in the home and a pamphlet called "Protect Your Family From Lead in Your Home." For more on lead hazards, see the National Lead Info Clearinghouse at www.epa.gov/lead/pubs/nlic.htm.

Penalties for Failing to Disclose

Most states put some teeth into their disclosure laws, by allowing buyers to cancel the sale if the seller doesn't provide the disclosure form or doesn't fill it out completely and honestly. Some states also charge monetary penalties to sellers who violate the law or punish sellers' real estate agents for failing to disclose problems that they observed or were told of by the sellers.

Can You Trust the Disclosures?

Now comes the question of how much to believe of what the seller discloses. There's no nice way to put it: Sellers are just people, and some of them lie. Even some upright citizens lie, after rationalizations like, "The basement hasn't flooded in years (never mind the drought)."

And lying isn't the only problem. Even honest sellers may be allowed to keep quiet about something they only suspect. Some state's forms may offer handy escape hatches, like a box saying "don't know," or "no representation." In Oregon, for example, sellers need only disclose problems of which they have "actual knowledge."

That can lead to situations like one described by Oregon real estate agent Debbie Stevens: "A buyer I represented moved into a house where, within one month, the water line from the street failed. Of course, we immediately wondered whether the seller had failed to disclose something. It turned out the seller's neighbors had had repairs done on their water line, and the repairperson had actually told our seller, 'Your water line is old, too; I can fix it while I'm in here.' But the repairperson couldn't predict when the seller's water line would fail, and the seller didn't want to pay for repairs. Unfortunately, we had to conclude that the seller wasn't necessarily wrong to say nothing, since he didn't know how close the water line was to failing."

Also, in most states, sellers aren't required to poke around for problems -- just to tell you what they already know. A house's owners can remain blissfully unaware of many serious problems -- a cracked foundation, termites deep in the walls, or a roof on the verge of leaking -- and won't be held responsible.

Reviewing the Seller's Inspection Reports (If Any)

Some sellers voluntarily provide copies of inspection reports they've commissioned themselves, either pest reports (common in California) or general inspections. In theory, this is no mere subjective opinion -- the report was drafted by a trained professional, right? The answer is a not-so-resounding "maybe." The quality of home inspectors varies widely, and are you going to gamble on the seller having chosen the most nitpicky one in town?

That's not to say the seller is trying to pull a fast one. But inspectors who are regularly hired by sellers describe feeling pressured not to be "deal breakers," but to downplay problems they find. They tend to use fuzzy words in their reports like "worn" or "serviceable."

Go to the source: Call the inspector directly. There's no law saying you have to rely solely on the inspector's written words. According to California inspector Paul A. Rude, "If you're seriously thinking about making an offer, call and ask the seller's inspector for details and for information about his or her background. Better yet, ask the inspector to come back and do a walk-through with you. Many will do this for a reduced fee."

So, if you've got a report in front of you, how do you evaluate its worth? Start by reading it carefully, following the advice on understanding inspection reports provided in Chapter 11. Also check whether the inspector is a member of ASHI (the American Society of Home Inspectors). And you can ask your real estate agent about the reputation of the inspection company -- and of the seller's agent, who probably selected the company.

Best thing I ever did
Learn to decipher the pest report. Because Abby was looking for a fixer-upper, she knew it would have problems. But when the seller gave her the pest report, she says, "I almost called off the deal -- the fix-up was going to cost almost half of what I'd be paying for the house. Then I took a closer look. The report said things like, 'cellulose fiber near foundation -- $200 to repair.' It turned out that just meant there was a big piece of wood leaning on the foundation -- all I had to do was brave the spiders and drag it away. I found a lot of items that weren't as major as they'd seemed."

Finally, no matter how reputable the seller's inspector, if the report was written more than a few months ago, it's too old. New problems can crop up in a day. And the seller might have already tried to repair some of the problems -- for better or for worse. A professional inspection is important, but it's best to rely on the one you'll commission yourself, later.

Poking Around: Doing Your Own Initial Inspection

From the first moment you look at a house, you should be taking stock of its physical condition. If there's a chance you might make an offer, you'll want a clear idea of how much the house is worth, based partly on its state of repair.

Bring along the "First-Look Home Inspection Checklist," found in the Homebuyer's Toolkit on the CD-ROM. It details both the easiest and most important issues to look for.

The checklist won't lead you through an in-depth inspection. But there's a lot you can look for on an ordinary open house visit, like sagging rooflines and leaking pipes. Wait for an individual appointment to do things like turning on heat and stove burners. And again, if you're really interested in the place, you should hire a professional inspector, normally after making an offer.

Eager to take on more-difficult inspection tasks? Get guidance from:

• The American Society of Home Inspectors website at www.ashi.org. Under Homebuyers/Sellers, click "Virtual Home Inspection" to get a fun visual tour of what your inspector will eventually examine.
• The Complete Book of Home Inspection, by Norman Becker (McGraw-Hill Professional). Written for the layperson, this book includes helpful checklists and photos.
• Local community colleges, adult schools, and home improvement stores, many of which offer excellent and inexpensive classes in home repair.

Hey, Nice Dirt Pile! Choosing a Not-Yet-Built House

If you're buying a new home from a developer, a number of choices lie before you: which lot you want, which type of model house you like, and which upgrades you'd like inside. All of this can require imagination if you're buying before the house is built (though some developments are nearly fully built in advance).

Choosing Which Lot Your House Will Be Built On

They may all look like squares on the map now, but walk around, and examine the map for the following:

• Likely water flow. Improper grading leads to poor drainage. It's a common complaint in new developments and difficult to fix, so avoid lots located at the neighborhood low spot or the bottom of a hill. A lot on a creek may sound nice but end up flooded by next year's "100-year storm." Also look for concrete-lined drain channels in hillsides above your lot, which are often poorly maintained, leading to flooding or even a landslide.
• Roadways. If your house will be next to a major roadway, expect extra noise and traffic.
• Services. While it's convenient to have services close by, being immediately adjacent to a grocery store, fire station, or school can raise levels of traffic, litter, and noise.
• Lot size and position of neighbor's houses. How big is the lot in relation to the size of your house-to-be? In many new communities, homes are built so tightly together that owners can hear their neighbors' television or see in their windows.
• Location. You'll pay more for a house that sits on a lakefront and less for one that backs up against the freeway. The more desirable the location, the less negotiable the price.
• View. If a view is an important asset on your lot, find out whether you have a right to prevent downhill neighbors from blocking it with new homes, additions, or trees. Many trees grow fast enough to block a scenic vista within five to ten years.
• Remaining undeveloped land. If there's a big, open field nearby, find out from the local zoning or planning department what it's zoned for and what kind of development is planned. Unless it's a park, you can be sure that something will be built there eventually.

Choosing Your House Design and Upgrades

For the house itself, you might be choosing which model type you want and whether you want upgrades. This is where that low, advertised price can change dramatically. The modest-sized model may look tiny compared to the model mansion next door, and the simple, standard kitchen may look shoddy next to the glossy custom cabinets. To help rein in your choices, consider:

• What the model home includes. Some contain the upgrades, so that buyers mistakenly think that's what the final house will look like. Adviser Mark Nash says, "Ask how much the house you're looking at would cost with everything you see in it." Others contain cheap and tacky basics, to steer you towards the upgrades. Either way, look closely at the quality of woodwork, flooring, appliances, and more; decide which you're willing to pay to upgrade; and get the developer's promises in writing.

It's possible to negotiate for free upgrades, at least in slower markets. Because it doesn't cost the developer nearly as much to make the upgrades as you'd probably be charged, they use them as incentives.

• Your Dream List. If you'd never thought about needing a wood-burning fireplace or an outdoor barbecue, why add them now?
• The retail cost of possible upgrades. No need to pay a developer more to add high-quality materials than you'd pay for them yourself. Double check the cost of big-ticket items like cabinetry or floor coverings at your local home improvement store. Then negotiate with the developer to bring the price down, or plan to hire a local contractor for upgrades.
• What upgrades will add resale value. If you ever sell your home, the less flashy, more practical upgrades will attract the most buyers. For example, swimming pools don't always add value to a house, while extra office or storage space will. Other practical, valuable upgrades include more electrical outlets, a fenced-in back yard, and wiring for high-speed Internet.
• The tax impact of your house size and upgrades. You may have seen a property tax estimate in the seller's written materials. If the house hasn't yet been built and assessed, however, that figure means nothing more than the value of the land. Call your local tax board for information.

If you back out, your upgrades won't be refunded -- you pay for them up front. "I've seen people lose $50,000 in upgrades because of a job transfer," says Realtor® Mark Nash. "The reason for this policy is that the property is less marketable with your personal choices stamped on it -- it's more like a resale." Plan ahead!

Buying a New or Old Condo or Co-op? Research the Community

If you're buying in a community interest development, such as a condo, coop, townhouse, or planned unit development ("PUD"), its physical state shouldn't be the only thing on your mind. You should also be asking, "How much power will the community association have over my life -- and will it exercise that power?" Although the term "community association" may sound like a social club, the reality is that a few of your neighbors, whose personalities are up to chance, will serve in leadership roles. They'll make important decisions about your living environment. Some associations are responsible mini-governments, but many are like dysfunctional families. So, it's well worth your time to:

• read all the paperwork describing its governance and current situation, and
• ask questions of the sellers, the neighbors, and the governing body.

Read the Large and Fine Print

Community associations normally put their main rules into documents called the "bylaws" and "master deed" or "Declaration of Covenants, Conditions, and Restrictions" (CC&Rs). As soon as you're seriously interested, get a copy of these, as well as of this year's budget, and read them carefully (at the latest, you can make receiving these documents a contingency of your purchase offer, as described in Chapter 10). If you're buying a newly built home, the builder may include these as part of your disclosures.

You'll learn about things like the permission process if you want to add onto your house, what color you can paint it, limits on pets, types of allowable landscaping, how high the association dues are, when the association can decide to charge you special assessments for projects affecting the entire community (like the pool or common room), and more. This isn't abstract stuff -- it will have a real, direct impact on your daily life.

You may find that the association owners don't want to cough up these documents until you've made a purchase offer. For condos, however, anyone can go to the county recorder's office and get a copy of the CC&Rs. (They're part of the deed that's recorded to publicly show who owns the property).

Unless you're buying into a completely new development, these documents are just the beginning. You'll also want to research what the association or board has been up to lately. Ask for minutes from recent meetings, and review these for signs of internal disputes, financial troubles, or planned new projects. Also check on the ratio of units that are, or are allowed to be, rented out. The more units are owner-occupied, the better the community usually is at attending to details like the budget and maintenance.

Why so much research early on? First, if there are restrictions you can't stomach, you'll know the place isn't for you. Don't assume that the rules will change, or that an exception will be made for you! Second, you want to know how well funded the association is. If there isn't enough cash in reserve, your monthly dues may go up, or you may have to pay special assessments.

Ask Lots of Questions

As with any neighborhood, it's worth finding out how people like living there, and who your neighbors will be. But you should also ask more-targeted questions, from your first interaction with the seller or seller's agent, and continuing on with people you meet within the community. Ask about everything from governance policies to package delivery to the neighbors' characters.

See the "Condo/Co-Op Question Worksheet" in the Homebuyer's Toolkit on the CD-ROM for suggested questions.

For more about meetings and other features of community living: See the resources offered by the Community Associations Institute (CAI, www.caionline.org). Your state's website should also link you to your community association law.