Purchasing a house is a major investment. Whether you are a first time homebuyer, or a real estate you certainly want to know: When is it the best time to buy or sell?
The state of California has always been a trendsetter for the rest of the nation. This includes real estate trends. Most leading players in the real estate market keep a close watch on California in order to see what is in store for the rest of the nation’s real estate market.
Real estate trends are predictable because they develop over a long period, unlike the volatile stock market. Although home sales levels in California are falling, the demand for houses remains strong and steady. Always do your research before undertaking a purchase of property in California.
It is important to read and track real estate articles in order to identify trends in California’s real estate market. Here are some key indicators to look for:
Home Sales
This key indicator refers to the total number of homes sold. In the law of supply and demand, when there are few buyers, real estate prices fall. The less home sales there are, the less expensive homes will be.
Another factor to consider is the growing inventory of available houses in certain counties in California, which is changing the market dynamics. What was once a sellers market is slowly turning into a buyers market.
Interest Rates
When interest rates rise, buyers shy away. Conversely, lowered interest rates attract more buyers. This year, interest rates in California are on an upswing.
Building Permits
The higher the number of building permits issued, the higher the demand for houses. Therefore, the more building permits issued, the more housing will cost.
Loan Defaults
This refers to failure of homeowners to pay their monthly mortgage fees. One downside to this is that many Californian homeowners are choosing to have a bad credit report, rather than to keep paying fees for a home whose value has been inflated by as much as 20 percent more.
Foreclosure Sales
When foreclosure sales are on an upswing, consumer spending is down and consumer debt levels have risen. In the real estate market, this has meant that many financially strapped homeowners are selling their homes at lower prices. The other contributable factors are inflation, the rising prices of gasoline, federal budget deficit, and interest rates.
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