Home Real Estate A Guide to Real Estate Cycle: Understanding the Market

A Guide to Real Estate Cycle: Understanding the Market

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Real estate is linked to local and national economic trends also called the real estate cycle. So, whether you are planning to buy or sell, it is necessary to understand this cycle inside out to make better decisions and predict the upcoming trends. While expansion is the phase where you may note a lot of growth in the housing market, it starts shrinking during the contraction phase. The real estate market stays up or down and eventually follows a typical pattern observed over time. Here are the stages of the cycle based on which buyers and sellers should act.

The real estate Cycle

As opposed to what you think, the real estate market is not as unpredictable or volatile. A majority of trends you come across are cyclical that come and go every few years. While the annual cycles change seasonally, the economic situations refer to the mare conditions over several years. If you are planning to invest in     new housing developments Kelowna, try to develop an understanding of the cycles in the real estate market and position yourself as a buyer trying to make the most of your finances in the long and short term.

Understand the annual real estate cycle

The annual cycle in the real estate market executes across twelve months and comprises four stages relating to three seasons.

  • The first stage from January to March
  • The first three months of the year evoke the sense and keenness of buying homes, whether it is for first-time customers or existing homeowners. Sellers too are at an all-time high trying to list their properties and hearing up their sales strategies. Apart from this, real estate professionals squeeze out some opportunities for sales at the start of the year. Unfortunately, the inventory at this time may not look as strong as you think. Prospective homebuyers need to stay careful about their investments and the limited availability of homes may cause the interest rates to rise sharply.

  • The second phase from April to June
  • Spring comes with a lot of relief after the dark winter months and home buying is at an all-time high. Better weather and outdoor activities are a couple of reasons that may entice people to invest in Kelowna new home developments. Summer is soon to begin and people need to accomplish the buying process as early as possible. There are more deals during this time of the year and the inventory of property developers stays full. However, that may mean that you will get offers of buying and selling from different quarters. Do you want to miss the golden opportunity of investing in new residential developments? It’s time you close the deal smoothly, so jump for the right options as soon as you can and grab the best homes in the best locations.

  • Third phase from July to September
  • The summer months retard the sale process as spring witnesses a majority of the buying spree. This may also mean that sellers are likely to push the best offers before the fall. If you are a buyer, you can hone your negotiation skills to make the most of the options. However, sellers may make some gains or lose a few deals as the offers tend to fluctuate during the summer months.

  • Fourth Stage from October to December
  • The winter months are cold in Canada, so the prices drop sharply as fewer people are interested in buying and selling of homes. Again, buyers trying to get their piece of profit with new development Kelowna may come across deal that are advantageous beyond expectations.

Economic cycle pattern

The economic cycle pattern occurs within every few years and provides better insights onto what lies in the future.

  • The recovery phase begins after the end of recession when the demands start taking off rather slowly. The prices tend to rise gradually and most homes for sale stay vacant. For buyers, this phase may have some good signs while the sellers may start looking up again.
  • The expansion phase belongs to sellers and shows a surge in the prices and the availability of properties. For the buyer, the deals during this stage turn rather competitive.
  • The buyer’s market is when they get an opportunity to choose from a flurry of options and the power rests in the hands of buyers.
  • Finally, during the recession stage, prices decline and indicate a challenging time for sellers and buyers.

It’s hard to predict the future of those selling properties in new housing developments Kelowna and those who buy from them. Whether it is for buying or selling home, you need to do your analysis of the timing to know where the economy is heading

Emil Anderson Properties is a name to reckon with in residential development and offering commercial property for lease Kelowna. Whether you are keen to explore homeownership or need to get office space in Kelowna, they offer some amazing deals.

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