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Few Benefits of Hiring a Professional Real Estate Agent

Buying a dream property often becomes a formidable task mostly because there are various minute goals associated with it. Starting from searching a suitable property to creating a proper budget; there are various aspects that figure the success of a property deal. In fact, fulfilling these goals becomes even more difficult for the ones who are first-time buyers. In such circumstances, taking help of an expert real estate agent proves sensible.

Making the first property purchase worthy of investment is something that every person desires. Fulfilling this desire becomes easy when one hires a real estate agent. Ensuring that a person gets the desired property according to personal preferences, needs and finances are the primary goals of an expert real estate agent. Now, let us have a quick look at the few benefits of hiring these professionals.

• Searching the Right Property

Getting closer to a dream property is the most daunting task. It requires adequate searching and an effective network of valid sources. Big real estate agencies shelter these realty agents. These agencies work as a hub where a property buyers and sellers meet. Therefore, agents associated with a respective agency have a widespread and effective network which helps them in being aware of the property listings of a respective area. Regular updates from them enhance the chances of getting the desired property within a short period.

• Multiple Options

Getting multiple options, while buying, makes the task easier for the buyer. Real estate agents offer multiple property options, which help people in selecting the desired property according to preference, needs and finances. Apart from this, multiple options give a liberty to the buyer to inspect thoroughly before making a last decision.

• Necessary Updates and Notifications

Realty agents offer necessary updates and notifications about the latest evolved property listings of a particular area. Most agencies now integrate modern technology with their services and this is a major reason for which most of them own a website. The buyers can come to know about the evolved property updates through web portals and can get information about the recent property listed for sale in a particular area. Apart from this, the updates make sure that the buyers don't miss out on the latest opportunities generated.

• Negotiation and Settlement

The job of a real estate agent does not end by taking the buyer closer to the dream property. They negotiate and settle on a specific price. An expert agent negotiates with the sellers with an objective to lower the price. And if one is lucky then, one might get a chance to buy the property at a lower price.

A realty agent works as a guide in the complete property buying process. People interested in buying property at a low price can contact these professionals because they offer information about property auction, as well.

Price Measurements of Residential Real Estate Markets

There is no perfect measure for any broad financial market activity, and real estate markets are one of the most difficult to measure accurately. There are a number of methods for measuring prices and price changes in residential real estate markets. These include the median price, the median price per-square-foot, and the Case-Shiller indices.

Markets for stocks, bonds and other securities are the most widely reported and measured financial markets. It is relatively easy to measure activity in these markets because all sales are recorded at a few central exchanges and the "products" are uniform (one share of stock is equal to another). In contrast, real estate markets are much more difficult to evaluate. Real estate transactions are recorded into the public record in thousands of locations across the country. Keeping an organized database of these records is such a daunting task that the title insurance industry has taken this responsibility as part of its business model, and many people are devoted to the arduous task of obtaining and organizing these records on a daily basis. Real estate does not have the uniformity of stocks or other financial instruments. Each property has unique qualities that differentiate it from all other properties making like-kind comparisons very difficult.

Geographical location is a major influence on the value of real estate. Even if two properties could be found with identical physical characteristics, the values of these properties could vary considerably based on where they are located. Ideally, a market measure would record the changes in sales prices of identical assets or in the case of an index, a group of similar assets. The unique nature of real estate assets makes it difficult to use standard measures of reporting utilized in other financial markets.

Due to the problems of asset uniformity and variability based on location, real estate markets are typically measured using some form of median pricing over a specified geographic area. The median is a statistical measure of central tendency where half the data points are above and half the data points are below. For instance, in a list of 5 numbers sorted by size ($100,000, $200,000, $300,000, $500,000, $900,000,) the third number in the list ($300,000) would be the median because it has two numbers that are larger and two numbers that are smaller. The median ($300,000) is used rather than an average ($400,000) because a few very expensive properties can increase the average significantly, and the resulting number does not represent the bulk of the price activity in the market.

One of the problems with a median as a measure of house prices is a lag between when a top or a bottom actually occurs and when this top or bottom is reflected in the index. During the beginning of a market decline, the lower end of the market has a more dramatic drop in volume than the top of the market. This causes the median to stay at artificially high levels not reflective of pricing of individual properties in the market. In other words, for a time things look better than they are. At the beginning of a market rally, transaction volume picks up at the bottom of the market at first restarting the chain of move ups. During this time, the prices of individual properties can be moving higher, but since the heavy transaction volume is at the low end, the median will actually move lower.

The median is a good measure of general price activity in the market, but is does have a significant weakness: it does not indicate the value buyers are obtaining in the market. The houses or structures built on the land compose the most significant portion of real estate value in most markets. These structures deteriorate over time and require routine maintenance that is often deferred. During times of prosperity, many people renovate homes to add value and improve their living conditions. The impact of deterioration and renovation of individual properties is not reflected in the median resale value. Also, at the time of sale, there are often buyer incentives which inflate the recorded sales price relative to the actual cost to the buyer. These buyer incentives also distort the median sales price as a measure of value.

Many data reporting services measure, record, and report the average sales cost on a per-square-foot basis to address the problem of evaluating what buyers are getting for their money. For instance, in a declining market if people start buying much larger homes at the limit of affordability, the generic median sales price would remain unchanged, but since buyers are getting much larger homes for the same money, the average cost per-square-foot would decline accordingly. This makes the average cost per-square-foot a superior measure for capturing qualitative changes in house prices; however, this method of measurement does not capture the relative quality of the square footage purchased, only the price paid for it. High quality finishes may justify a higher price per square foot. There is no way to objectively evaluate the impact finish quality has on home prices. The main problems with using the average cost per-square-foot to measure price is that it does not provide a number comparable to sales prices since it has been divided by square feet, and it is not widely measured and reported.

To address some of the weaknesses of the generic median sales price as a measure of market value, Karl Case and Robert Shiller developed the Case-Shiller indices for measuring market trends. This index measures the change in price of repeat sales. It solves the dilemma of pricing like-kind properties, almost. Although these indices capture the price movements of individual properties far better than the generic median sales price, it does not take into account value added through renovation and improvement. To address this issue, the index gives less weight to extreme price changes assuming the outlier is a significant renovation. However, if there is a market-wide renovation of properties, as was the case in many markets during the Great Housing Bubble; this will cause a distortion in the index. The other weaknesses of the Case Shiller indices concern how and where it is reported. Since it is an index of relative price change rather than a direct measure of price, the index is reported as an arbitrary number based on a baseline date; therefore, the numbers are not useful for evaluating current pricing. The index is also confined to 20 large metropolitan areas around the United States. The large geographical coverage areas are required to obtain enough repeat sales to construct a smooth index. The broad yet limited geographical coverage fails to capture price changes in smaller markets. Also, since the Case-Shiller index is a measure of changes in prices of sales of the same home, it does not include any newly constructed homes. No measure is perfect, but the Case-Shiller index is the best at measuring historic movements in pricing because its methodology is focused on repeat sales of the same property.

The Great Housing Bubble was an asset bubble of unprecedented proportions. Between 2000 and 2006 Home prices increased 45% nationally, and in California home prices increased 135%. Had this amazing price increased coincided with a period of high inflation, it may not have been indicative of a price bubble, merely the general increase in prices of all goods and services; however, inflation was low during this period. The inflation adjusted price increases nationwide were 23% and in California it was 100%. There was no great improvement in the quality of houses justifying the higher prices. Although some homeowners made cosmetic improvements, the vast majority of homes were unchanged during this period, and many deteriorated with age. Resale homes did not undergo any form of manufacturing process where value was added to the final product. There was little real wealth created during the bubble, just a temporary exaggeration of value.

Free Grants For Real Estate Purchasing

Isn't it ironic that the best time to purchase real estate for resale with government home grants, is during a time when the housing market is at it's worst? At a glance that would seem quite ridiculous, as we usually tend to assume that when industries are doing well, it is then the proper time to consider investing. This is certainly not the case in the real estate though. In fact, even though it would appear as though the entire housing market is on lock down, with so few people willing to make major purchases in these times of poor economy, right now is the utmost best time to purchase your real estate for resale.

Some may ask, "Why on earth would I invest in sellable real estate properties while no one is buying?" Well there are two very good for reasons for this, and once you have been enlightened to them, you will see that this really does make perfect sense. If you are a real estate investor, or a hopeful looking for your first golden opportunity, be advised that right now, is the best time to get busy. Most people are shying away from the thought of real estate investments right now in fear of overspending and inability to resell due to decreased American spending habits. This eliminates a great deal of the competition for you during the bidding wars.

If these individuals knew what you are about to learn, they would be running for the auctions. Now that we mention it, you'd better grab your running shoes because by the end of this article you may be running for the real estate auctions too, and dropping by the government grant applications agencies along your way. The two main reasons why now is a great time to invest in real estate are these...

Homes and properties are selling for far below actual value due to poor economy, foreclosures, and just a general state of nationwide personal debt. This means that if you were to buy now, while the property prices are lowered, you can be quite sure that once the state of national debt has improved, your property value will skyrocket. This means extreme and certain profit for you.

The other, and even more appealing reason is that in light of the situation described above, the government is in a real bind trying to persuade American citizens to recommence spending money again to jump start the economy, the housing market in particular. Now brace yourselves because what I am about to share with you is so exciting, you may not be able to contain yourselves. You may be able to get hundreds of thousands of dollars in free government money to finance your real estate properties.

The government is directing a great amount of the grant award funds that they are required by the law to distribute, towards real estate grants, home grants, and first time homebuyer grants. This free unclaimed government money can be yours to buy homes and properties for yourself, or for resale. Since you are receiving free government financial aid to make your purchase, and are buying now, while prices are so far below actual value, you will essentially be buying instant equity.