4 factors that affect real estate prices
Many factors affect the price a specific home could fetch, if offered for sale, on the real estate market. While there are both emotional and logical considerations involved, four specific factors, in general, are the key components, which make the biggest differences, in what price, a specific house, could be obtained and the offers, which will be presented. . While there are always competitive factors, especially how a specific property compares to others for sale in the local area, after more than a decade as a licensed New York State real estate seller. I have come to believe that 4 specific factors are the most significant and relevant. With that in mind, this article will attempt to consider, review and briefly discuss these considerations and why it is important to proceed, with objectivity and a realistic approach.
1. General economy and consumer confidence: Obviously, the stronger the economy in general, and the more consumer confidence, as well as belief, in a strong and sustainable employment/labor market, the more people might be ready, willing, and able to pay for a new home, than his! Perceptions are often far more essential and relevant than any single factor or factors!
two. Interest Rates and Real Estate Taxes: General interest rates are the key to mortgage rates, and obviously the lower these rates, the lower the monthly costs to the homeowner. Even a minor rate change often makes a significant difference in monthly expenses. In this mindset, property taxes should also be considered, because they take into account the overall costs of home ownership, maintenance, etc.
3. Offer and demand: They can be considered real estate markets, buyers’ markets, sellers’ markets and/or neutral markets. When there are more buyers than houses on the market/sellers, it is a Sellers Market. When there are more sellers than those qualified buyers looking, it becomes a Buyers’ Market, and when it’s somewhere, more balanced/in the middle, it’s neutral. Obviously, in most cases, the highest prices occur in Sellers’ Markets, based on the economic concept of Supply and Demand!
Four. Local market: Much of the real estate, is local, in nature! Is your local area in demand? What are the strengths and weaknesses? How does your area, neighborhood, location, etc. compare? with other areas? Factors to consider include: safety; schools; convenience of transportation, shopping, entertainment; real estate taxes; etc.
The better you understand real value, as opposed to what you want, the more prepared you will be for the home buying process. Will you commit to homework, discipline, etc.?