Four Major factors of Real Estate market by Ravinder Tulsiani | Real estate show a important portion of most peoples property, and this is especially true for many homeowners in the United States or Canada. According to thr most recent Survey of Consumer Finances by the Federal Reserve, 65.1% of American families owns their own primary residence. The size and scale of the real estate market make it an attractive and paid sector for many investors. This article will look at some of the important factors that affect the real estate market and the variety of investments available.
1. Interest Rates
Interest rates also have a important role on the real estate markets. Changes in interest rates can greatly effect a persons ability to purchase a residential property. That is because only the lower interest rates go, the lower the cost to obtain a mortgage to buy a home will be, which creates a higher demand for real estate, which again pushes prices up. Conversely, as interest rates increase, the cost to obtain a mortgage rise up, thus lowering demand and prices of real estate.
2. The Economy
Another important key factor that change the value of real estate is the overall health of the economy. This is generally measured by economic indicators like employment data, GDP, the prices of goods manufacturing activity, more. Broadly speaking, when the economy is sluggish, so is real estate.