Most people dream of becoming a homeowner because of how significant it can be as an investment and the opportunity it offers to settle down. For millennials, it can be difficult to know where to start with the process. If you're looking to buy your first home, there are a few important steps to take.

1. Save for a Down Payment

One of the most important ways you can prepare to buy a home is by saving money for a down payment. It's important to save at least 20 percent of the selling price of the home. If you're afraid it could take too long to save enough money, you can resort to an FHA loan to only put down 3.5 percent. Keep in mind that with an FHA loan you'll have to pay PMI insurance.

2. Determine How Much House You Can Afford

Knowing your budget before you begin shopping around for a house is necessary to avoid falling in love with something you can't afford. Determine what your budget is by calculating your household budget, which should include your spouse's salary. The down payment will influence your monthly payment.

3. Increase Your Credit Score

Your credit score will determine if you're approved for a loan and your interest rate. Increasing your credit score is necessary to obtain the best rate and save more money over the term of the loan. You can increase your credit score by paying off debt, making your payments on time, and disputing any errors that may be present on your credit report.

4. Consider Other Expenses

Other expenses come with owning a home that you'll have to consider when calculating what you can afford. You may also have to pay private mortgage insurance, homeowner's insurance, property taxes, and HOA fees. It's also important to set aside money for maintenance and repairs on the property.

5. Get Pre-approved

Consider getting pre-approved for a loan before you start to shop around for a house. If you haven't secured financing in advance, the seller won't take your offer seriously. You can also risk losing the house to another buyer while waiting to get pre-approved.

6. Know Your Wants and Needs

Before you begin to look for your first home, it's important to know what you want and need to ensure the property accommodates your lifestyle. If you plan to expand your family in the coming years, you may want to consider buying a house that has enough square footage and a larger yard. You may also want an updated kitchen, a home with an open floor plan, or even a house with hardwood floors. Write down a list of must-haves that you can give to your agent to ensure they know what you're looking for in advance. The list can also make it easier to narrow down a few options.

7. Check Out Open Houses

Visiting open houses can allow you to see different listings in person and get a firsthand look at the properties you're considering. Residential properties can look entirely different in-person rather than online, making it necessary to visit the home and take a tour. Consider visiting multiple open houses in a day and map out a specific route. Be sure to take photos or jot down notes to remember what you liked or disliked about each property at the end of the day.

8. Hire a Realtor

As a buyer, you can benefit from a realtor's services because you can discover more homes in the local area where you plan to buy. Real estate agents are often aware of properties that may not be advertised, which can allow you to have an advantage over other buyers. Some people forego the professional's services because they don't want to pay any fee, but fortunately, the seller of the home you buy is responsible for paying the agent.

Knowing the best ways to prepare for buying your first property can make the process smooth and seamless. Although it can take a lot of time and energy to become a homeowner, your hard work and effort can make it worth the long-term rewards it offers.