Reading or watching news regarding the housing market can make a homeowner’s head spin. You might hear that mortgage rates are up, sales are down and prices are stagnant – all in one day. How can you know when the news of the day should influence the decisions you make about your home and finances?
Housing reports typically baffles people
During the early 2000s, Fed Chairman Alan Greenspan’s briefcase had its 15 minutes of fame when cable news networks watched it with a hawk’s eye, noting a correlation between the thickness of his briefcase as well as a alternation in interest rates. Today’s homeowners have accessibility to a much more nuanced – and seemingly never-ending – flow of information about every element of real estate.
Quarterly local, state and regional reports outline sales trends in painstaking detail. National headlines and news-magazine promos pique our curiosity about just how the recession-recovery cycle is presently affecting our bottom line. Real estate websites such as Zillow and Redfin attempt to clue in consumers about home values determined by wide-ranging data; and though Greenspan’s briefcase has been retired, even the suggestion of a change in interest rates can still wreak havoc on markets.
As outlined by a May 2016 research paper by the National Bureau of Economic Research, even our social media networks can get inside our heads when it comes to our home selling and buying decisions.
Clearly big bucks are at stake within the battle for real estate information. So how can a homeowner know who to trust prior to making a bold move?
Take your time. David Moon, a columnist for the Knoxville News-Sentinel, calls the early 2016 market crash related to China’s economic downturn “a great lesson in the importance of not making investment decisions based solely on headline news.” China’s economy had shown signs of trouble since 2010, he said. The Chinese government’s manipulation of the GDP through massive government capital spending masked the issue, he wrote, leaving many investors in a lurch when China’s financial problems became clearer. The moral of the story is to stay up to date on housing trends while avoiding knee-jerk reactions. Adhere to a few reputable sources of information to stay abreast of the marketplace.
Think local. While national issues certainly can affect local markets, some areas of the U.S. survived the national housing meltdown of the mid-2000s. Local and regional issues, such as the arrival or departure of a major employer or a booming or busting industry, may have a much larger impact on home values.
Trust your agent. Personal finance guru Dave Ramsey advises consumers to hire financial advisers with “the heart of a teacher, not the heart of a salesman.” Use the same standard when hiring a real estate agent.
While your agent really should not be your sole resource about values and trends, real estate transactions involve a lot of your hard-earned money, and when your financial health is at stake, you should only work with an agent whose advice you value.
Real Estate 101
In a paper published in May 2016, researchers with the National Bureau of Economic Research discovered that consumers whose online friends said their home values had risen more than 5 % over the previous two years were 3.1 percent more likely to complete a home purchase within the next two years.
“What’s more, they are 1.7 % more likely to purchase a bigger home, 3.1 percent more likely to pay a higher price for it, and 7% more likely to make a larger down-payment,” writes the National Association of Realtors.
Our team is not part time, not full time, we are all the time agents in the housing market. We are here to assist you in the Tampa Bay and Surrounding areas. When you are ready to get started, give us a call at 813-300-7116 or simply click here and we will get started working for you.