It appears that in practically every financial field, some people try to get an edge by timing a specific component in order to, ideally, buy low and sell high! This is a common occurrence in real estate purchases, particularly residential sales!
When prices appear to be trending upward, especially in recent days, when we have seen a record-breaking pace of price increases, more people appear to be getting involved in what is known as, flipping a property, which entails purchasing a home at an opportune price, making some, mostly cosmetic changes, and then selling it quickly for a profit!
After more than 15 years as a licensed real estate salesperson in the state of New York, I’ve seen this procedure be successful, as well as far less so! With that in mind, the purpose of this post is to investigate, examine, assess, and explore four reasons why most people should not attempt to advertise – time, real estate.
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You can’t regularly and/or properly foresee the future
If we had a Crystal Ball, we might be able to forecast the future more correctly and consistently, even in relation to housing values! Because these prices have a tendency to be cyclical in the past, it’s difficult to determine when this would make sense! Obviously, every financial strategy/action should be weighed in terms of risk/reward, and only those who are ready, willing, and able to deal with the risks, stressors, and potential losses should attempt to flip a house!
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Real estate is influenced by a number of (not just one) factors, including pricing
There is no single aspect that influences how prices will fluctuate! Interest rates (including mortgage rates and terms, among other things); Supply and Demand; seller and buyer opinions; confidence! We’ve had record-low interest rates and associated mortgage terms for a long time! As a result, more people will qualify for a mortgage, increasing demand. Supply and Demand is perhaps the most important component, and when supply is less than demand, prices rise! One aspect is dependent on emotions, and hence both buyers and sellers’ views! Many people’s mindsets are influenced by overall consumer confidence, and this has an impact on the market!
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Different elements don’t always function together
When mortgages are simple and inexpensive to obtain, prices normally rise! When confidence is high and inventory is low, the market tends to rise! However, those characteristics that tend to rise and/or decrease property values may not always align, making overall trends more difficult to anticipate!
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Relationship between qualified, potential home buyers and house sellers
In general, when demand is high, there are more qualified potential buyers than available homes (inventory). A Buyers Market is frequently created by the opposite set of circumstances. At times, we see a neutral set of circumstances!
Trying to market – time, real estate, is speculative and dangerous for most people! Proceed with an open mind and a well-considered approach, just like you would with any other financial asset!
We make a foray into the digital world in order to understand the buying and selling trends and opportunities in social media for 2021. Let’s get there!
