It can be hard to buy real estate when the market is tough, even if you have a lot of money to spare. The thing is, there is a lot of risk when it comes to real estate, whether you are purchasing your first home or you are investing in a rental property.The first step is to make sure that you are selecting the right town. With a house, you can remodel it and add additions to it. You can change it any way you would like, for the most part, but you cannot change the town. Therefore, the location of the property is key. Never purchase something in an area that you absolutely do not love.Once you have found the perfect location, you can then start looking for the perfect property. The thing is though, you should really have a genuine idea as to what you can afford. Do not let someone else such as a real estate broker or a lender tell you that you can afford more than you are comfortable with. You know your finances better than anyone.Go over all of your bills. Figure out what you can afford for your monthly payments to be. You want to make sure that you are getting real estate that fits within your monthly budget. If you get something that you honestly cannot afford, you will eventually find yourself in a lot of financial trouble, possibly even foreclosure. Foreclosure may not be on your mind at the moment, but it is something you should think about when deciding how much to spend.Many times, lenders will tell someone that they are approved for a loan that is double the amount that they should really have. They say that this after taking into consideration the applicants debt to income ratio, but this is not a realistic view of what your debt is. They only look at the basic bills and what appears on your credit report.Things such as sports for the kids and your habit of going out to eat twice a week are not taken into consideration. If you want to keep up with the life style that you are used to, you will have to be the person that decides just how much of a house or piece of land you can afford. After all, you are the one in the end who has to deal with the monthly payments and the stress that can come along with that.As you can see, there is much more to buying real estate than just calling a Realtor and picking out a house in your town. You really have to be careful with it and you need to make sure that you are carefully thinking through each and every step that you take. If you can do this, you are sure to end up with a real estate deal that cannot be beat.The next time you find yourself looking at real estate, the steps will come much easier to you. With practice, you will find yourself to be a real estate genius in no time at all.