Northern Virginia Property Appreciation
MOST OF THE TIME THE BEST INVESTMENT YOU CAN MAKE IS IN YOUR OWN HOME
Understanding real estate appreciation
Real estate appreciation refers to an increase in value of your Northern Virginia home and the property. When your property "appreciates" you have greater equity against which to borrow, and you realize a greater profit when you sell. Property values fluctuate regularly for many different reasons, so how do you know the home you're buying is going to appreciate over the years?
By and large, the economy is the driving factor of real estate appreciation in the U.S. That includes interest rates as well as the current employment rate, business growth in the area, housing supply and demand and affordability.
Regional economic and social factors also affect real estate appreciation. Many
homebuyers choose to live in areas with the best and most convenient
features for households to thrive, such as a close proximity to
schools, jobs and commerce.
A good school district can also be an indicator of good home appreciation. It is believed that good schools help foster lifestyles associated with high levels of attainment at the individual, household and community level. The Northern Virginia real estate market is somewhat unique to the rest of the nation. We enjoy a very low unemployment rate because of the federal government and the many contractors associated with government agencies in the area.
Demographics also play a role in real estate appreciation. For example, during the 1980s, much of the baby boomer generation (People born between 1946 - 1964) was buying real estate, causing homes to appreciate at a faster rate than inflation and made real estate a profitable investment. The group referred to as Generation Y - born roughly between 1980 and now - is the biggest generation since the baby boomers. Their contribution to real estate is expected to be far greater than their older siblings of Generation X (born between 1965 and 1979).
There
are some aspects that significantly contribute to real estate
appreciation, which you may want to ask your agent about when shopping
for a home:
Recent sales. Ask your agent or retrieve public records on real estate sales in the Northern Virginia neighborhood you wish to live in. How
many home sales have there been in the past year? What are the asking
prices? Do the final sales exceed the asking prices or are people
getting less than list price?
It is important to note that while appreciation is nice to have, it should not be the reason you decide to buy a home in a particular area of Arlington, Alexandria, Fairfax, or Falls Church. Even if you buy a house in a rapidly appreciating area, there is no guarantee that its value will rise by the time you want to sell it. That's why it's best to pick a neighborhood - and a home - in an area that suits your own needs. Lives change and you never know when you might need to sell your house or condo.