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Inflation and the Impact on Real Estate Transactions

Talk of inflation has dominated the news in recent months, but what does this mean for the real estate market? Knowing more about the possible impact of inflation on real estate trends is important. Keep the following information in mind when helping your clients buy or sell homes.

About Inflation

Inflation happens when money doesn’t have as much purchasing power. This can have an impact on both buyers and sellers in different ways.

Sellers

Sellers can benefit from rising inflation as long as they’re able to find interested buyers who qualify for a mortgage. There’s still a lot of demand for homes and a smaller supply than usual, making this a seller’s market. In some areas, sellers are receiving offers that are far above their listing price. Those who plan on putting their home on the market this year should consider this when determining a listing price. While inflation can help sellers, keep in mind that sellers who also need to purchase a new home might experience negative impacts when buying.

Buyers

For home buyers, inflation can make it harder to compete with investors and buyers who are able to offer cash or much higher prices over the listing price. Along with inflation, interest rates on mortgages are going up. Higher interest rates can make it harder for some buyers to qualify for a mortgage. In some cases, buyers are also being priced out of certain areas or having to settle for homes that are smaller than what they wanted. This makes it more important than ever for buyers to have a real estate agent with solid expertise at their side.

For more information on real estate trends and assistance with marketing your properties, contact Properties Online. We offer smart lead capture, real estate sites, and more to help you improve your real estate business.

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