Home prices: Need some help understanding why they appreciate?
Property prices are forever in flux. Generally, property values appreciate in the long term. But, in real estate there is always a certain amount of risk.
When your house appreciates you have a bigger asset to borrow against, and you'll realize a greater profit when you sell. Property values fluctuate for numerous reasons, so how do you know what you're buying right now won't depreciate the day after you close? The most important aspect to consider is that you choose a REALTOR® who can identify the factors that drive local prices.
Many are convinced that the economy is the top factor affecting real estate appreciation. Obviously, there are a handful of issues on a national level that influence your property's value: unemployment, mortgage rates, inflation, and more. But the most significant issues that decide your home's value depend on the local economy and housing market.
Location in a community - Convenient access to schools, employment and amenities like shopping, restaurants and entertainment is important to a lot of buyers and will greatly influence home values. So those areas typically appreciate, or hold their value consistently, year to year.
Recent sales - Your real estate agent should give you stats 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.
Appreciation history - Have property prices increased or decreased over the last 5-10 years? Is the area considered desirable because of its location or affordability?
The local economy - Are local businesses hiring? Have businesses moved into or away from an area? Is there a fair blend of jobs in an area, or does it depend on just one industry? Is the mix of commercial and residential development changing? These items play a part.
Recognizing the factors that impact your property's worth is important. Click here to get an assessment of your property's value. Have any questions? Please feel free to call me at 610-804-6977 or e-mail me.
* MOL = More or Less
RE/MAX Main Line 1646 West Chester Pike Suite 2 West Chester, PA 19382
Location in a community - Convenient access to schools, employment and amenities like shopping, restaurants and entertainment is important to a lot of buyers and will greatly influence home values. So those areas typically appreciate, or hold their value consistently, year to year. 
