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Whether you’re buying or selling property, it’s important to understand what drives the real estate market. According to JoAnn Meier at RE/MAX First Choice, market conditions will play an integral role in both the price and net worth of a potential home. This is why she makes it a priority to educate her Waterloo, IL, clients on how the housing market is performing before they move forward with their transaction. Here, she explains what the primary factors are that influence the market.

What Drives the Real Estate Market?

1. Interest Rates 

The average real estate investor will require financing from a lending institution, which means interest rates are a top consideration when purchasing property. Many buyers wait for low interest rates before entering the market, thus affecting the demand for housing. This can also encourage sellers to list in an attempt to close a deal and upgrade while rates are attractive. Conversely, high interest rates are likely to slow the market down, as buyers do their best to avoid paying more on their mortgage.

2. Demographics 

real estateDemographics refer to the age, gender, race, and income of a certain area. This data has a major part in controlling real estate prices and determining which type of properties buyers are searching for. Demographic statistics largely influence the sale and purchase of properties and are influenced by several other factors, such as location, size, and amenities.

3. Economy 

The overall strength of the economy will help determine whether or not buyers have the ability to support housing prices. Elements, such as employment rates, product prices, and the stock market, are good indicators of how healthy the economy is. Generally, when the economy is stagnant, the real estate market suffers. Buyers don’t have the income to make a large financial commitment, leaving sellers with listings that don’t move for long periods of time. 

The status of the housing market will have a significant impact on the decisions you make regarding buying or selling. JoAnn Meier at RE/MAX First Choice can help you determine if current market conditions are set up for you to successfully achieve your real estate goals. Call (618) 939-6003 to schedule a consultation, or visit her website to browse available properties for sale.  

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