Factors Which Impact Real Estate Prices

 Many factors affect the price a particular house could fetch if offered for sale on the real estate market. While there are both emotional and logical considerations involved, four specific factors are generally the key components that make the biggest differences in how much a particular home can fetch and the offers that will be presented. . While there are always competing factors, especially how a particular property compares to others for sale in the local area, after more than a decade as a licensed New York State real estate agent. I have come to believe that 4 specific factors are most important and relevant. With this in mind, this article will attempt to briefly consider, review and discuss these considerations and why it is important to continue, objectively and realistically.

1. Overall Economy and Consumer Confidence: It is clear that the stronger the overall economy and the greater the consumer confidence as well as the belief in a strong and sustainable employment/labor market, the more people may be ready, willing and able to pay for a new home from your own! Perception is often far more important and relevant than any other single factor(s)!

2. Interest Rates and Property Taxes: Overall interest rates are the key to mortgage rates, and of course, the lower the rates, the lower the monthly costs for the homeowner. Even a small change in rate often means a significant difference in monthly expenses. Property taxes also need to be considered in this regard because they factor in the overall cost of home ownership, maintenance, etc.

3. Supply and Demand: Real Estate Markets, Buyers' Markets, Sellers' Markets and/or Neutral Markets may be considered! When there are more buyers than homes in a market/sellers, it is a seller's market. When there are more sellers than there are qualified buyers looking, it becomes a buyer's market, and when it is somewhere, more balanced/in between, it is a neutral market. Obviously, in most cases, the highest prices occur in sellers' markets based on the economic concept of supply and demand!

4. Local Market: Much of the real estate is local in nature! Is your area in demand? What are the strengths and weaknesses? How does your area, neighborhood, location, etc. compare to other areas. Factors to consider include: security; schools; convenience in transportation, shopping, entertainment; property taxes; etc.

The better a person understands true value, as opposed to what they wish for, the better prepared they will be for home buying. Will you commit to tasks, discipline, etc.?