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Understanding
Property
Prices
Unimaginative people forecast property prices       Contents



in the same way they do the weather – what          Introduction....…...............…....................…..1

                                                    Interpreting Economic Growth....................2
happened yesterday will be approximately the
                                                    Understanding the Role Mortgage Interest

same   tomorrow.    The problem       with   this   Rates Play.....................................................2


approach is that they miss out on planning for      Countering Inflation.....................................2



unnexpected things, like balmy days when
profits are available to be hunted down.
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                           Real estate investment is an art and not a science. Making
                                               profit with property is as intuitive as any other form of
1602 Alton Road #432
Miami Beach, FL 33139                          business. Many ForeclosureDataBank.com customers have
1-888-596-9279
                                               made money by blending intuition with their knowledge of the
contact@foreclosuredatabank.com
                                               effects of economic growth, interest rates and inflation. With

The biggest foreclosures database on the
                                               understanding, you could do so to.
web

Find us on the Web:
www.ForeclosureDataBank.com

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Understanding Property Prices

  • 1. Understanding Property Prices Unimaginative people forecast property prices Contents in the same way they do the weather – what Introduction....…...............…....................…..1 Interpreting Economic Growth....................2 happened yesterday will be approximately the Understanding the Role Mortgage Interest same tomorrow. The problem with this Rates Play.....................................................2 approach is that they miss out on planning for Countering Inflation.....................................2 unnexpected things, like balmy days when profits are available to be hunted down.
  • 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. 3 Foreclosure DataBank Real estate investment is an art and not a science. Making profit with property is as intuitive as any other form of 1602 Alton Road #432 Miami Beach, FL 33139 business. Many ForeclosureDataBank.com customers have 1-888-596-9279 made money by blending intuition with their knowledge of the contact@foreclosuredatabank.com effects of economic growth, interest rates and inflation. With The biggest foreclosures database on the understanding, you could do so to. web Find us on the Web: www.ForeclosureDataBank.com