What Drives Home Prices?

By
Real Estate Agent with Your Family Realty llc

This last Labor Day weekend I snuck away for a vacation with the family and thus got to observe several different real estate markets.  I know it's sick, but I do pick up real estate magazines everywhere I go:-()

The first market was a North woods resort town.  The economy is seasonal with the result that recreational properties are really expensive, but residential properties in the town are really quite cheap.

The second market is a blend of tourist town, small college town, and forestry/agriculture.  It's a town of 11,000, but all types of properties outpace our market by $20,000-$30,000.

My market has 100,000 people, but homes remain moderately priced w/the median price being $137,000.

In observing the market, it appears to me that neither the local economy, style of town, etc... had much to do with the differences.

Price variation came down to supply and demand only.  Readily available types of properties remained moderately priced while limited properties were highly priced.

Is supply and demand the main factor in your market or is it something else?

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Tags:
eau claire real estate
market analysis
chippewa valley real estate

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainer
109,504
Jon Angevine
Discover Real Estate - Calgary, AB
Calgary Real Estate & Condos

I was once told by someone who wanted to look at and buy only a FSBO listed house was that it was us as Realtors who set the prices for the market!  They subsequently bought a home in an area that used to be a dump near a house that was busted by the police as a house of prostitution - guess they got their deal though!

I would say supply and demand has a great deal to do with it...

Sep 05, 2007 09:11 AM #1
Rainer
19,727
Jeff Tumbarello
Steelbridge Realty LLC - North Fort Myers, FL

socionomics

Socioeconomics or Socio-economics is the study of the relationship between economic activity and social life. The field is often considered multidisciplinary, using theories and methods from sociology, economics, history, psychology, and many others. It is a relatively new social science that has emerged as a separate field of study in the late twentieth century. Most colleges and universities do not have a separate department or degree for socioeconomic studies.

Socioeconomics typically analyze both the social impacts of economic activity and economic impacts of social activity. In many cases, however, socioeconomists focus on the social impact of some sort of economic change. Such changes might include a closing factory, market manipulation, the signing of international trade treaties, new natural gas regulation, etc. Such social effects can be wide-ranging in size, anywhere from local effects on a small community to changes to an entire society.

Sep 05, 2007 09:25 AM #3
Rainer
7,467
Robert Johnson
Your Family Realty llc - Eau Claire, WI

Jon,  although I know some Realtors who are so arrogant they think they can set house prices, I think it's generally true that a Realtor can't just demand any price he/she wants for a home and think it'll happen.  The market is driven by something or else you and I would have no time to blog. We would just be going out and telling people how much money to give us :-)

Jeff, your post on socioeconomics speaks to underlying issues that drive supply and demand.  However, I often guess wrong.  For example, a new bypass just opened by our home.  My thought were that this would drive people to snatch up the valuable land along either side.  Hasn't happened.  Maybe it's to early.  I'll wait and see.

Sep 05, 2007 09:34 AM #4
Rainer
143,779
Gary J. Rocks
Werner Realty - West Milford, NJ

Ron

Supply and Demand play a major role but Location is a factor and schools plays one of the most important roles of them all.

Sep 05, 2007 10:15 AM #5
Rainer
7,467
Robert Johnson
Your Family Realty llc - Eau Claire, WI
Gary, Thanks for your comment.  Do particular schools district in your area actually raise home prices for that area.  In our location, their is only one school district and the standard is about the same.  What drives our market would be proximity to conveniences (shopping, recreation,etc...).
Sep 05, 2007 10:22 AM #6
Rainer
3,532
Jeff Heller
California Real Estate Associates - License- 01234147 - Lake Elsinore, CA

As of 2010 in Southern California - Supply and demand with lots of other factors 1. Economics  2, Location, 3. Forclosures in the area, 4. Apprasal,  5. School Dist all factor in..

Real Estate Agents need to do Comparables correctly.. Not every buyer has CASH, But they have a down and good credit..

Aug 04, 2010 06:43 PM #7
Post a Comment
Spam prevention
Show All Comments
Rainer
7,467

Robert Johnson

Ask me a question
*
*
*
Spam prevention