iowahomeloans

How to Evaluate a Target Housing Market

Posted on: August 23, 2014

The principal of home buying from an investment standpoint is to “buy low and sell high.” The recession of the past few years and the housing market adjustments that have drastically changed the real estate landscape has also made home buyers more conscientious than ever before of the desire to buy well. As a result of this desire for certainty when making a home purchase, more and more people are holding off on buying a home until things “settle down.” Unfortunately, this can cost you the best deals. Instead, evaluate your target housing market and determine when is the best time to buy for your particular situation.

 

Look for Key Indicators

 

A slow local economy typically indicates that it’s a good time to buy a home. A slow economy means that home sales slow down, sellers are more willing to bargain to sell a home, and prices may fall. However, a conscientious home buyer doesn’t want to buy too early in a slow economy, for fear that home prices will fall further and they’ll miss out on the best deal. This type of worry can also prevent you from buying at the right time, though.

 

First and foremost, recognize that you’ll never be able to predict the exact right time to buy. But you can make an informed decision by looking at key indicators. Look for things that signal economic growth, such as a reduction in unemployment numbers, growing numbers of jobs coming into the local economy, or rising salaries. Another good indication is new businesses coming into the area; if there are a lot of new retail storefronts or restaurants nearby, the economic pot is likely coming to a slow boil.

 

Buy as early as possible in this process. As it becomes more and more apparent that an economy is improving, home sales begin to rise again and you’ll face more competition for existing home inventory. Now is an excellent time to find a wonderful home at a good price.

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