Understanding property appreciation
Over time, the worth of a house will go up and down. For the most part, house values appreciate in the long term. But, of course, there are no "sure things" in real estate.
When your home appreciates you have a larger asset to borrow against, and you'll generate a higher profit when you sell. But how will you know what you're investing in today will appreciate over time? Property values in change for various reasons. The most important element is that you choose a real estate agent in who understands the factors that influence local prices.
A lot of people believe that the economy is the most important factor affecting real estate appreciation. Obviously, there are many factors on a national level that affect your house's value: unemployment, mortgage rates, consumer confidence, and more. However, your property's value and the features that play the most significant role in its appreciation depend on the local economy and housing market.
Location in a community - Convenient access to schools, jobs and amenities like shopping, restaurants and entertainment is a big deal to many buyers and will greatly influence home values. So when it comes to holding their value, these regions typically appreciate much more reliably than areas lacking key features.
The latest home sales - You should receive stats on the recent real estate sales in the regions that you're asking about from your REALTOR®. You'll need to learn data like how long a house stays on the market and seller discounts.
Appreciation history - Have property prices gone up or down over the past 5-10 years? Is the area thought of as desirable because of its location or affordability?
The local economy - Are local companies hiring? Have businesses moved into or away from an area? Is there a nice mixture of jobs in an area, or does it depend on just one industry? Is the mix of commercial and residential zoning changing? These items play a part.