Over time, the value of a home will go up and down.
Usually, home values appreciate in the long term.
But, of course, in real estate there is always a certain amount of risk.
When your property appreciates you have more equity to borrow against, and you'll generate a larger profit when you sell.
There are various reasons why property values in Lexington move up and down. So, how will you know what you're investing in today will appreciate over time?
The most important part is that you choose a real estate agent in Lexington who is familiar with the factors that affect local prices.
The economy is thought to be the biggest factor affecting real estate appreciation.
mortgage rates, employment, business growth, government programs and a handful of other national determinants have a noticeable impact on your home's worth.
But the most significant factors that determine your home's value are particular to the local Lexington economy and residential market.
Location in a community - Being close to schools, employment and amenities like shopping, restaurants and entertainment is a priority to many families and will greatly influence home values.
So when it comes to retaining their value, these communities usually appreciate much more reliably than areas lacking key features.
Real estate sales trends - How fast are houses selling? What was the selling price versus the asking price? A lot of data can be retrieved from public records, but a good agent with access to the local MLS will often be able to provide a more complete picture.
History of appreciation - In the past 5 to 10 years, have home prices risen or declined? Does location or affordability affect how desirable the area is believed to be?
Local economy - Is there a nice mix of job types in an area, or does it rely upon just one industry? Have companies moved into or away from an area? Are local companies hiring?
Each of these pieces plays a role.