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Good To Know: 3 Short Truths That Rule Every Real Estate Market

Interested in becoming a marketplace expert? Swell, then you’ve come to the right place.

Because whether you are in a small suburb or major metropolitan municipality—regardless of the country, economy or period of time in which you’re conducting business—there are three short truths that rule every real estate market. They are universal—no matter if you’re a buyer, seller, analyst or agent yourself—and we’re eager to share them with you.

Sure, these may seem like no-brainers at first. That’s because, um, they should be! But as Toronto finds itself in the throes of a potential (and perhaps already active) housing bubble—with unprecedented competition and potential regulatory measures ahead—we figured it might be best to take a moment and remind everyone of these principles.

Plus, by encouraging you to stay aware of them, our hope is that you’ll be prepared and motivated to make the best moves you possibly can. That’s what we’re here for, after all!

Ready, set, go…

real-estate-supply-and-demand-curve-1
1) The law of supply and demand governs real estate…

Simply put, both the appreciation of a market and the expectations of buyers and sellers—as well the speed of market sales—are all dictated by one factor: the supply of, and demand for, land or buildings for sale. This rule is absolute and utterly without exception.

2) … As does that of cause and effect.

cause and effectVigorous economic growth will lead not only to a robust real estate market, but also a subsequently strong appreciation of homes. On the other hand, a declining economy—and the job losses that accompany one—will generate the entirely opposite effect. In other words: positive situations will yield positive outcomes, and vice versa.

3) History always repeats itself! 

Stretches of swift real estate appreciation are regularly succeeded by sluggish spells. It is within these intervals where values begin to stabilize or, worse yet, decrease. And repeat. After all, any marketplace experiences such cycles. So by obtaining market knowledge and watching regional statistics—and we’ll teach you how to do all that soon—you should be able to start effectively anticipating trends and applying them to your own advantage.

history repeats