A real estate market is the process by which property values are determined, and transactions occur, on both a local and international scale. The market is influenced by various factors, including economic conditions, demographic trends, and government regulations. It is also impacted by market cycles, consisting of expansion, plateau, and contraction phases. Finally, technological advancements and innovations are reshaping the industry (PwC, 2020).
Residential real estate includes structures used for domestic residence such as single-family homes, condominiums, and apartments; commercial real estate consists of office buildings and other non-residential facilities; and industrial real estate is comprised of warehouses and other manufacturing and distribution properties. Generally speaking, demand for these types of properties is driven by various factors, such as population growth, employment rates, and migration patterns. Economic trends can also influence real estate demand, as they can impact income levels and purchasing power.
Vacancy rates and building construction trends are important indicators of the health of a real estate market. Low vacancy rates indicate there is not enough supply of properties to meet the needs of interested buyers, while high vacancy rates suggest that there are too many vacant homes or rental units on the market.
Additionally, the real estate market is impacted by changes in interest rates and government policies, which can affect investment opportunities. It is therefore crucial for real estate professionals to stay informed about these market shifts so they can best advise their clients on potential investments.