Housing prices are constantly changing, which can make both buying and selling a home more complicated. While it’s difficult to predict future changes, it’s important to understand the key factors that affect the housing market and home prices. Here are the five major things that affect housing prices:
The overall health of the economy is a major influence on housing prices. While made up of myriad factors, the “health” of the economy can usually be determined by employment data, manufacturing data and prices of goods. As the economy flourishes, housing prices increase. Likewise, if the economy is suffering, prices often decrease.
The fluctuation of supply and demand affects goods and services, and property is no exception. Because physical property is a finite resource, supply and demand can become extremely important in densely populated areas. The differences between a buyer’s and seller’s market is the amount of demand compared to the amount of actual housing inventory.
If the Federal Reserve changes interest rates, mortgage lenders have to adjust accordingly. This results in a different interest rate on your mortgage or loan. Even though the change may be less than a tenth of a percent, it can make a tremendous difference in housing prices. As mortgage rates increase, many would-be homebuyers cannot afford higher priced homes. On the flip side, lower mortgage rates can encourage more buyers to enter the market, which affects pricing through supply and demand.
The location of a home affects its price immensely. There are multiple factors in a location that can affect pricing, such as specific neighborhoods, highways, specific attractions or cultural interest, hospitals and schools. Home prices are higher in areas with rapid growth and lots of commercial activity. Some other location-based variables that can affect the price of a home include crime, healthcare access and proximity to industry.
Understanding the variables at play in the overall economy will help you navigate the housing market with confidence. Keep these factors in mind during your home search or selling process to stay up-to-date on what affects housing prices.
Hi, I'm Carolyn Brown and I have over 20+ years of real estate experience, serving Bay Area Counties: Alameda, Contra Costa, Solano, Sonoma, Sacramento, and Central Valley. I have a Master's Degree in Psychology and I work part-time for West Contra Costa Unified School District. This has afforded me the opportunity to connect with families and communities.
I have always been a giver and compassionate about serving and helping others. A real estate career was never my goal but the passion I have to help others changed that and I would love to help you! Whether you're in the research phase at the beginning of your real estate search or you know exactly what you're looking for, you'll benefit from having a real estate professional by your side. I'd be honored to put my real estate experience to work for you.
If credit is an issue, please don't let that discourage you. Having excellent credit is a work in progress but definitely workable. SmartCredit is an inexpensive App that will help you get on track and keep you on track. If you are proactive and willing, this can work for you. Sign up at: www.smartcredit.com/Chewzcarolyn.
Also, I am an author. My book, "S.O.U.L Inspiration 4 Life Daily Word" is guaranteed to inspire you and encourage your soul. Giving up isn't an option, and if you desire to become a homeowner, then contact me and I'll show you how. Never let what you see, hinder what you believe. My wonderful book is available online at Amazon.com, Barnes and Noble, and Xulon.com. Let me know if you have any questions. Let's build a legacy together.
Thanks for ChewzingCarolyn!!!