Learn from the history of real estate: periodic markets: 5 important factors
If we learn from the past, in a purposeful way, then we will better understand that the history of real estate should teach us, and housing markets are often cyclical! There are bullish and falling markets, as well as periods, with a greater balance, between these two. Most of them have heard references to buyers ‘markets, as well as sellers’ markets, however, it seems that people continue to overreact to changing conditions, etc., so it would be helpful, to better understand, some of the reasons, driving forces occur, participation , In making these courses. With that in mind, this article will briefly attempt to consider, examine, revise, and discuss, 5 important factors, and some potential implications and implications, involved.
1. Interest rates:
One of the driving forces in housing markets is interest rates. It may be driven by the market, depending on economic conditions, being manipulated (for political purposes, etc.), or by mortgage rates. After all, when one pays lower prices, to get a mortgage, we are generally seeing an increase in buyer demand, because it is possible to get more money! Low rates mean, one acquires the ability to buy more home, in dollars, because the costs of his monthly pregnancy fee are reduced. However, throughout history these have been reduced, raised, and often significantly affect the overall industry!
A good economy generates a greater degree of confidence, because people seem to believe, and it is a good time to buy! On the other hand, when there is economic anxiety, it affects the real estate industry, in a negative way!
3. Consumer / job confidence:
the better, job security and consumer confidence, the better, the housing market responds. On the other hand, many people are cautious and anxious, during periods of actual or perceived turns, or even prospects, or even rest, from searching for a home. The laws of supply and demand either raise or lower prices, when sellers or buyers are in greater supply!
4. Pricing / Affordability:
There is often a point of diminishing returns, when it comes to price hikes! When these rise too quickly (or are seen as houses costing a lot), many people see them as inexpensive and move away from the housing market. Obviously, this will lead to a price correction!
5. Real Estate Taxes:
Areas with high real estate taxes often have the most market fluctuations, because, in particular, given that the tax legislation, enacted in 2017 that ended discounts, to $ 10,000, these homes are becoming more A challenge to the market, selling!
The more you understand and learn from the past, the better prepared you will be for future fluctuations! Will you become a smart home buyer?