The more varied the opinions of economic experts, the more we are required to do our own homework when making real estate decisions for the future. This is especially true when there are varying degrees of optimism and pessimism about the nation’s economy. Many homeowners use interest rates to measure the health and viability of real estate. But the national economic outlook is not the only relevant factor in the health of the real estate market in your area.
Educated real estate investors look beyond the macro economic outlook to local factors that impact their investment. For example, the stability of local employment and consumer spending has a direct impact on the supply and demand for homes and condominiums and therefore their prices. New housing developments in a local market also impact the supply, creating “buyer’s markets”.
As you evaluate the value of your investment or try to predict the future value of a potential purchase, be sure to understand both the national economic environment and the specific factors of your local community.