Real estate is hailed as one of the most remunerative sectors of all, especially now in West Vancouver. Vancouver realtors claim that it makes a lot of difference if you have the acumen and the awareness to know which property to buy or sell and when. There are certain factors, however, which are beyond your control. There is very little that you can do about them. These elements are controlled by further other happenings like changes in the socio-economic situations, politics, and world trade amongst several others.
Here is a list of six external factors that tremendously affect your real estate investments.
- Interest Rates: Interest rates are decided to keep the economy going and to avoid stagnancy. The interest rates and pricing of the real estate property are inversely related to each other. If the pricing is high, it is generally found that the interest rates are low.
- State Laws On Rents: The rent control laws vary from state to state. They also get modified from time to time. If the state laws are very strict, the buyers will generally be hesitant in investing in that area.
- Various Taxes: There are several taxes like municipal property tax, speculative tax, property purchase tax and capital gain tax are some of the taxes that directly affect the real estate investor. Whether you are a buyer or a seller, overbearing charges can make your profits seem sour. This is one external factor that is crueler than the others.
- World Economy: if the economy is on the boost and everyone is making money in their respective sectors, real estate investments automatically go up. it has been often observed that economy plays a huge role in determining the realty business’ success or failure. When the economy is good, people are happy and wealthier. This encourages them to invest more money and feel safe about it. In a dying economy, people are very apprehensive about making any investments, let alone those in real estate.
- Political Factors: Politics also affect the demand and supply of all markets and this involves real estate too. Political policies can have a huge bearing on the prices of the properties. If the policies make it difficult or overtly expensive to buy properties, there will be a decline in real estate investors.
- Current Perspective: Then there is the way public thinks at any given moment. Buying and selling property is also a trend governed by how people feel at a given moment.