: Factors that Influence House Prices
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(445 Words)
House prices are related to many different factors. Some of these have to do with the particular house whereas others will affect the entire housing market. Consider the following factors.
The economy
The economy can affect the entire housing market. When the economy is in a downturn people may have less money. They may be laid off from their jobs or earn less money because companies are giving fewer raises and promotions. They may not be looking to spend money on a home. In addition, many people might not be able to meet their mortgage payments so the homes might go into foreclosure. They may need to sell them off quickly and end up offering them for lower than they would have before. In 2010, this is happening in many areas across the United States. Many homes are valued at far lower than they were before. Many homes that would have been snapped up quickly in the past are now languishing on the market, their prices being ever-lowered.
The location of the home
A home’s price can be affected greatly by its location. The exact same home will be a vastly different price if it is in driving distance of New York City compared to if it is in the rural hills of Vermont. Even within an area, the prices will range. Some homes will be close to something desirable such as a city that is an employment hub, the beach, a convenient highway and more. Likewise, some homes that are located near something like a train or off of a busy road might be valued at less. The quality of the schools in the area might also play a part in how much it is valued since it will cause the area to be more or less desirable to families.
The crime rate in an area also plays a large part in the home prices. If there is a lot of crime, then fewer people will want to move there, whereas if the crime is low more people will want to be there.
The quality of the home and the neighborhood
How nice a home and its surrounding neighborhood are will make a difference. If the home or surrounding area is in disrepair, then fewer people will want to reside there. This can change as homes become older.
Interest rates
If people have to pay more interest on their loans, then they might not be able to spend as much on the home as a whole. If interest rates are low, they might be able to afford more.
There are many factors that affect home prices. The above are just a few of them.
Updated On: 08/20/2010 Published On: 08/20/2010 Article ViewerClose
Helium 360 – Sciences 360
SCIENCE PROJECT 20100801 – 20100831
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