Does Real Estate Always Increase In Value?


Does Real Estate Always Increase In Value?
By Scott Rogers • January 31, 2008
Yes and no . . . As an overall trend, real estate (almost) always increases in value. The graph below shows the "Four-Quarter Percent Change in Virginia House Price Indexes," based on data from the Office of Federal Housing Enterprise Oversight. Each quarter, the OFHEO releases the House Price Index, which is described as "...a broad measure of the movement of single family house prices." The figures represent the amount of increase or decrease in housing prices in a particular market, based on a repeat-sales index. They derive their data based on repeat sales of the same property, or refinances of the same property. Since 1975, there have only been eight quarters (out of 127) when the house price index has declined. The graph below shows the value trend that would have existed for a home valued at $100,000 in 1975 --- using the OFHEO's house price index to determine growth in value. But don't forget -- all properties do not follow overall trends during all time periods. Some buyers have mistaken the trend described above to mean that all properties will increase in value during all time periods of ownership. However, it is essential to remember that the trends are based on a market as a whole --- in the case of my examples, the entire state of Virginia. So while real estate values as a whole (in Virginia) seems to (almost) always increase, that will not necessarily be the case for all individual properties in Virginia. Receive Updates by Email Recent Articles: There Are Plenty Of Types Of Houses That Exist That Just Are Not Available To Purchase Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell Consider The Cost Of Your Planned Renovations When Planning Your Offer
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 21, 2024 (unless otherwise noted).
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