Factors That Influence the Housing Market
Is now the time to make a major real estate investment? It can be difficult to know what will happen with the market in the future. Long-term real estate ownership is a great investment, but find out how to read these factors to determine what will influence the housing market in the near future. Use these predictions to invest wisely and to seek the best financing option for your investment portfolio.
Overall Economic Growth
A growing economy is a good news for everyone. In general, when the economy is growing then the housing market is strong. Look for signs of job growth and high wages as signs that housing prices and demand are going to continue to rise.
Of course, this makes the opposite true as well. Slowed economic growth and decreased wages typically lead to a lower housing market. Economic downturns may not be the best time to sell your real estate.
New Constructions vs. Renovations
Look for signs of whether the next year will focus more on new builds or on renovating existing structures. New constructions are typically signs that a housing market is strong and has more motivated buyers than real estate available. This can be a great time to put your real estate investment in either new constructions or renovations, depending on the specific features of your local housing market.
Home Buying Demographics
Are individuals more likely to buy or rent? Despite the myths of millennial renters avoiding homeownership, individuals in this age bracket are still buying a significant amount of homes. Look for trends in this demographic as another sign of whether to invest in rental properties or single-family homes to renovate and sell.
The home buying tastes of the current generation of home buyers can also play a major role in your investment decision. If condos and large vacation homes aren’t selling anymore, apartment buildings, tiny houses, and unique real estate options may be a more popular and more reliable investment.
Mortgage Rates and Financing Options
Mortgage rates and available financial alternatives play a major part in the housing market. Historically, low interest rates can encourage more home buyers and increase the demand for properties in your area.
There are no perfect predictions of the housing market. Look at these signs and determine the best investment option you can make. Work with local real estate investment institutions to find the best property and financing to match your business plan and your predictions of the housing market.