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Understanding Property Prices Unimaginative people forecast property prices

Contents

in the same way they do the weather – what

Introduction....…...............…....................…..1

happened yesterday will be approximately the same

tomorrow.

The problem

with

this

approach is that they miss out on planning for unnexpected things, like balmy days when profits are available to be hunted down.

Interpreting Economic Growth....................2 Understanding the Role Mortgage Interest Rates Play.....................................................2 Countering Inflation.....................................2


2

Interpreting Economic Growth Governments and their banks are quick to announce up-ticks in their economies, because they make good political profit from them. Average real estate prices are sensitive to these announcements, especially in early days. When you anticipate and know this, you can turn profits surprisingly quickly. For example, a 1% increase in gross national product may translate to a 4% price increase if other factors hold good.

Understanding the Role Mortgage Interest Rates Play Speculators need increasing average property prices to make money. In turn, these need eager buyers. Few of these can afford cash though, and this means that cheap loans are required to complete the growth cycle. This is a hard nut to crack. Governments lower interest rates in recessions and tweak them up in boom times to control inflation. Between these two points, there is a magic moment when interest rates are low and property prices are rising. This is when property speculators strike gold.

Countering Inflation As mentioned, interest rates have a strong influence on property prices, and hence the profit that may be made from selling on. There is a dwell time here too - sellers are not always aware of current trends and may sell on at lower prices than they need to.


3 Foreclosure DataBank 1602 Alton Road #432 Miami Beach, FL 33139 1-888-596-9279 contact@foreclosuredatabank.com The biggest foreclosures database on the web Find us on the Web: www.ForeclosureDataBank.com

Real estate investment is an art and not a science. Making profit with property is as intuitive as any other form of business. Many ForeclosureDataBank.com customers have made money by blending intuition with their knowledge of the effects of economic growth, interest rates and inflation. With understanding, you could do so to.

Understanding Property Prices  

ForeclosureDataBank.com are experts in foreclosed property and predicting price trends. This is a rare opportunity to share this knowledge.

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