What causes home prices to fluctuate?
Home prices are continually changing. Over a long enough period of time, house values normally go up. But, of course, there are no “sure things” in real estate.
When your property appreciates, you have more resources to borrow against, and you’ll generate a higher profit when you sell. There are numerous reasons why property values move up and down. So, how do you know what you’re investing in right now will appreciate over time? Choosing a real estate agent who understands the factors that affect local prices is the most important element to consider.
A lot of people assume that the economy is the greatest factor affecting real estate appreciation. Naturally, there are quite a few factors on a national level that influence your house’s value: unemployment, mortgage rates, quarterly earnings reports and more. But the most significant things that decide your home’s value are particular to the local economy and residential market.
Access to services – Most people want homes in the regions with the best and most convenient amenities, such as our schools and work. So, when it comes to retaining their value, these regions typically appreciate the best.
The latest home sales – You should receive information on the recent real estate sales in the areas that you’re asking about from your agent. You’ll need to learn things like time on market and listing price as opposed to selling price.
History of appreciation – In the past 5-10 years, have home prices risen or declined? Does location or affordability affect how desirable the area is thought of as?
Local economy – Is there a nice mix of business in an area, or does it depend on just one industry? Have companies moved into or away from an area? Are local businesses hiring? These items play a role.