Buying Real Estate: What Affects Real Estate Prices

Without a doubt, we all love having our own home and enjoying it for as long as we want, however sometimes we are torn between two major options: renting a home and using the remaining money for design and other similar processes or actually owning a house. The bottom line is that we need a home and it is without a doubt a human necessity. We can discuss different areas and how expensive real estate is within those areas or we can discuss the advantages of each option. A small example – in Arizona if you are searching for a home you will find a variety of choices – you may encounter homes that have a waterfront or a golf view and so on. In such an area the homes will probably be rather expensive because of the numerous facilities and the nice weather.

You see, there are many things that may affect the price of real estate – not necessarily external factors such as recent increases in overall price or how crisis affects the market. I am discussing about typical advantages and disadvantages that affect the price – for example, a home in a quiet neighborhood with a medium-sized garden, lovely color, durable materials, interesting furnishings and other similar advantages, will naturally cost much more than one in placed in a rather cramped, noisy neighborhood but with the same advantages as the other home.

The location and neighborhood is one of the greatest factors affecting the home’s price. The features, weather, area, noise level, parks, scenery, and schools–especially schools–have a very serious affect on the home’s price. Whether a house is on a busy street or a quiet street. The look of neighborhood homes near it or the proximity to an airport (and airplanes flying overhead) as well. All these factors play a role in a home’s price.

The house itself also plays a role and one can be far above or below the average for a neighborhood, however the neighborhood itself is very dominant when it comes to price. Lately another factor plays in the pricing, with the downturn in the market, one can also take a look at the number of repossessed or foreclosed properties nearby and the amount of homes for sale. If everyone around is selling, prices drop.

As you can see, the neighborhood itself has a huge role to play in the pricing of a specific real estate property.

(Note: This article is the first of a series on buying real estate contributed by freelance author Sabina Munteanu. Contact her via RAC)