Real Estate valuations tend to respond to regional and local influences; there is no single real estate market. The levels of jobs, population growth, local economic conditions, weather patterns and proximity to waterfront are just some of the factors to consider.
Then there are the numbers. Typically buyers and sellers look at the price appreciation and sales. These are important numbers, but not sufficient to determine future issues related to supply and demand.
We suggest you also consider the sales rate, current inventory and the average price spread between list prices and sold prices. With these numbers you can get an idea about which direction prices will be heading in the near future.
Another factor to consider is the interest rate and how that will impact a buyer's ability to afford the different types of property. For example, land in a desirable area like the Texas Gulf Coast will be more affordable across a broader range of buyers than higher-end planned housing developments should appreciation or interest rates push the cost of ownership to high.
One more thing, a desirable and improving market like the Texas Gulf Coast will always have some measure of value above that of a typical real estate market and will also exhibit a greater degree of stickiness in price during normal market corrections because second home owners are generally in no great need to sell. “[Waterfront property] appreciates faster in good times and declines in value at a slower rate in bad times,” says Alan Hummel, past president of the Appraisal Institute and chief appraiser of Forsythe Appraisals.
Real Estate agents are often accused of always painting a rosy picture of the market regardless of what's really happening, and so we are exposing the actual numbers so you can judge for yourself.
Please contact us If you would like more detailed information or explanations behind any of the numbers and trends.
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