What are the Economic characteristics that drive the property Market or the real estate industry? There are many, each spilling into others and creating a funnel of sorts that can either make or break a particular market and even the market in general. As we get to looking at office buildings for sale in dayton ohio and more about the economic characteristics of the property market and their impact, I am going to lead off with a whopper of an example.
Have you heard about Amazon and how the company is deciding where its second headquarters will be located? It seems that Atlanta so far is its top choice, but no one knows just yet. Let’s say for purposes of this article that Amazon chooses Atlanta. What kind of an economic impact do you think that choice would have on the real estate market in Atlanta? Atlanta already has a strong market, but you would see investors buying up property in droves.
Real Estate Industry
The population of Atlanta would continue to increase at greater levels, too. This type of economic activity would create a boom. In other situations, a bust can be the result of a negative economic impact. Let’s say that the opposite of the situation described above happens. Let’s say that a major employer or more than one starts leaving the area. All kinds of things can start happening to a city and its real estate market.
Economic opportunity and real estate go hand in hand in so many ways. Think about what has happened, both good and bad, in other cities. The situation in Atlanta is hypothetical. However, think about the nationwide housing market bust a little over a decade ago and the subsequent economic recession. That is perhaps the biggest example of a time in recent history where economic characteristics and the property market or real estate industry collided.
What is the economic climate in your city like? Think about that for a moment, and consider how property values have everything to do with many economic factors. As for all areas in general, many factors can contribute to a scarcity of available properties. That has started to happen a little in general all over the US. It has been a buyer’s market for awhile now, years.
Scarcity is of course going to drive up prices even higher. It is that supply and demand rule in play. Are you able to see how many economic factors come together to impact the property market? It’s not always a one way street. The ultimate direction a market is heading is one way or the other; however, you have economic factors impacting the market positively and some negatively.
Ultimately, as a whole and in individual areas, one side wins out, at least for a time. And, over time, despite the recession and the housing market bust, the real estate market and property values continue to appreciate. The cost of everything goes up over time, as does inflation, and so you have just learned the bottom line about economics and real estate.