Market Trends gotcha confused these days? You’re not alone.
This post is all about understanding local market trends (from a home appraiser) so that buyers and sellers can make informed decisions.
If there is one thing that is more frustrating than the shortage of houses for sale it’s the understanding of current market trends.
Because the housing market trends are not always what most home buyers and sellers (and sometimes realtors) assume they will be.
As real estate appraisers, we must analyze the local market trends as they affect the individual house or property that we are appraising.
This post is all about understanding local market trends (from a home appraiser) so that buyers and sellers can make informed decisions.
Valuable Insights into Local Market Trends
Here is the ultimate guide to understanding local market trends (from a home appraiser) so that buyers and sellers can make informed decisions.
These are the market trends that real estate appraisers are researching when estimating market value:
📈Comparable Sales Analysis
Appraisers examine recent sales of comparable properties in the local area.
By analyzing these comparable sales (comps), appraisers can identify trends in property values, such as appreciation or depreciation, and understand the factors influencing market prices.
📈Market Conditions
Appraisers assess current market conditions, taking into account factors like supply and demand, inventory levels, and the overall economic climate.
This analysis helps determine whether the market is favoring buyers or sellers, and it provides insights into the trajectory of property values.
📈Mortgage Rate Impact on Market Trends
Appraisers understand the mortgage rates play a significant role in influencing real estate market trends.
Lower mortgage rates typically make homeownership more affordable. When interest rates are low, potential homebuyers can qualify for larger loans with lower monthly payments, which can increase demand for homes. This increased demand often leads to higher property prices.
Conversely, higher interest rates can reduce buying power and may lead to a decrease in demand, potentially causing property values to stabilize or decline.
Mortgage rates can impact the supply of homes in the market. When rates are low, homeowners may be more reluctant to sell because they may lose their low-rate mortgage if they move. This reduced inventory can further drive up property prices due to increased competition among buyers.
📈Seasonal Variations
Real estate markets often experience seasonal fluctuations.
This is especially true in our local market.
Appraisers consider the impact of seasonality on property values, helping homeowners and homebuyers understand when it might be more advantageous to buy or sell.
📈Absorption Rates
Appraisers calculate absorption rates, which estimate how quickly homes are selling in a particular market.
This metric indicates market activity and helps assess whether the market is favoring buyers or sellers.
📈New Construction Impact on Market Trends
New construction projects can influence local market trends.
Appraisers evaluate the impact of new developments on property values, including potential competition and changes in demand.
The most direct impact of new construction is an increase in the supply of housing units in the local market. If demand remains constant or grows more slowly than the supply, it can lead to a surplus of housing, putting downward pressure on property prices.
In some cases, new construction may be part of a broader revitalization process, where a previously neglected or declining neighborhood experiences an influx of investment and redevelopment.
📈Property Type Trends
Different property types (e.g., single-family homes, condominiums, commercial properties) may experience varying trends.
Appraisers distinguish between property types and assess trends specific to each category.
❓ Pretty cool, right. Which market trend would you like to know more about❓
Our Local Market Trends
Every month we run stats specific to our local market and publish in our website so that our neighbors can see what the house sale prices and home rental prices look like from a bird’s eye view of each county.
You can find them here:
Philadelphia and Suburbs House Prices
Philadelphia and Suburbs Rental Prices
This post is all about understanding local market trends (from a home appraiser) so that buyers and sellers can make informed decisions.
