Q. I've been sitting on the sidelines for years watching the boom and now the slowdown of the housing market. How do I know when it's the right time to buy a house?

Q. I've been sitting on the sidelines for years watching the boom and now the slowdown of the housing market. How do I know when it's the right time to buy a house?

A. Buying a house is more than timing the market. You must consider your lifestyle choices, your housing desires and, most importantly, your finances before embarking on what is often the largest purchase in a person's life.

Financial planner Barry Glassman of Cassaday & Co. in McLean, Va. advises his clients to first figure out if a house fits into their lives right now.

Perhaps you're planning to spend money on an upcoming wedding. Or, you're thinking of starting your own business or going back to school. All of these choices are large lifestyle changes that require a substantial amount of money. Maybe throwing a new house into the mix isn't the best idea.

Also, consider job security, Glassman said. If there has been recent turnover in your industry or if you may have to move for a promotion, perhaps you should hold off on buying a house.

However, if you determine that this is the right time in your life to buy a house, figure out what kind of house you want. Consider the size and location, how many people will be living there and who will be living there, and how long you expect to stay in the home. Once you've narrowed down what kind of house you want, then you can look at the how much that house costs.

"Generally our wishes exceed our pocketbooks when it comes to buying a house, so take the emotion out of the decision and figure out what you can afford and what's available," said Phillip Cook, certified financial planner at Cook & Associates in Torrance, Calif. You may have to prioritize your desires to find an affordable home.

To crunch the numbers, Cook recommends putting together a budget that shows how much you can contribute to a down payment and where that money is coming from. Will you be tapping stocks or bonds? If so, remember to estimate the tax implications of cashing in those securities.

Also, find out your credit score. Knowing your down payment and your credit history can help you estimate what kind of interest rate you can get. Then look at all mortgage options available to you — from the traditional 30-year fixed mortgage to more exotic types — but understand the ins and outs of each loan.

"Start learning the language of mortgages, so you're better prepared to go out there and identify a good mortgage versus one that has a lot of catches to it," Cook said.

Before diving in, make sure you understand the costs of owning a home. The expense is more than the monthly mortgage payment, Glassman said. People forget about the cost of property taxes, insurance and maintenance of a home, all of which can increase unexpectedly while their mortgage payments stay fixed. Potential buyers also don't count the money they expect to spend on upgrades or home furnishings.

"A person moving from an apartment to a single-family home forgets that they need to plow a long driveway. Suddenly you need to clean your gutters and mow your lawn, so you need a ladder and a lawnmower. Estimate the cost of all those things," Glassman said.