What drives property values to move up and down?

Over time, the value of a piece of real estate will fluctuate up and down. Generally, property values appreciate in the long term. But, of course, there is always a certain amount of risk in real estate.

When your property appreciates you have a greater asset to borrow against, and you'll realize a greater profit when you sell. Property values in move up and down for different reasons, so how can you be sure what you're investing in today won't depreciate the day after you close? The most important factor is that you select a real estate agent in who understands the factors that influence local prices.


Many think that the economy is the number one factor impacting real estate appreciation. Obviously, mortgage rates, unemployment, job growth, government programs and numerous other national factors have a definite change your home's value. However, your house's value and the elements that play the biggest role in its appreciation are particular to the local economy and housing market.

Let Alexander Premier Properties help you with your first home purchase in Access to services - Many consumers want to live in areas with the most conducive amenities for households to do well, like a close proximity to jobs and schools. So when it comes to keeping their value, these regions generally appreciate better than others.

Recent sales - Your real estate agent should give you information on the recent real estate sales in the areas that you're asking about. You'll want to know average time on market, selling versus listing price and more.

The appreciation history - Is the area thought to be desirable because of its location or affordability? Have property prices increased or decreased over the last 5-10 years?

Economic factors - Have businesses moved into or away from an area? Are local businesses hiring? Is there a good blend of business in an area, or does it depend on just one industry? Each of these items plays a role.

Recognizing the factors that play into your home's value is important. Visit this link for an evaluation of your home's value. Call me at 310-836-8690 or e-mail me if you have any questions at all. I'd love to hear from you.

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