There are many ways to earn money as a real estate investor. Renting and fixing and flipping are a few of the most common ways to invest in real estate to generate income.
However, for individuals who are looking to start their venture in real estate, micro-flipping could be a good option to consider.
In this post, we will learn what is micro flipping in detail.
Micro flipping is different from the traditional fix-and-flip strategy. It’s a wholesale strategy where technology and data are used to find real estate properties that are undervalued.
Once an investor has identified one or more undervalued properties, they will buy, flip and sell them immediately. The word “micro” describes how quickly these properties are flipped and sold.
This is more of a high-volume and low-profit strategy. You can only expect to make a few thousand dollars per transaction, but you can close a lot of transactions because they closed quickly.
While you may choose to make some cosmetic improvements to properties to make them more attractive to potential buyers, it is not mandatory.
The reason why this strategy gained popularity during the pandemic is because of its quick closing nature.
It’s a way to flip real estate, with the click of a button. This is just one of the many benefits associated with micro-flipping that have made it so popular even after the pandemic.
This strategy is a little different from traditional real estate purchase and sale.
The process is initiated with the property search, but not just any property. Micro flippers require properties that are undervalued as the profit margin is lower compared to any other strategy.
Investors can choose from a variety of tools, but make sure the one you choose has at least the basic features listed below:
Finding a home is just the beginning. The next step is where the investors have to negotiate the sales price with the sellers.
As the investors are looking to make a profit, they should try to get the lowest sales price possible.
Generally, micro flippers work with motivated sellers. For instance, a seller who is looking to sell the property to avoid foreclosure can benefit the investor to get the deal in his or her favor.
In this type of strategy, investors generally have the buyer lined up before they buy the property.
This is the only way to ensure a fast transaction. Without buyers aligned, investors have to incur carrying costs, which reduces profits, and with the low-profit margin involved in microflipping, it is not sensible to hold the property.
Investors must sell the property for a profit, which means using a quick sales strategy to convince buyers to buy the property.
Micro flipping can be considered a great form of passive investing as a majority of its process is done online. Your job will include finding underpriced properties, motivated sellers, and interested buyers. There is a small amount of work involved. In most cases, you can sell the property without any repairs to the home.
Another advantage of micro-flipping is speed and simplicity. You can move the property very quickly, especially when compared to a traditional neighborhood store. Micro conversions can be done using data analysis techniques. There is no need to cold call, knock on doors or drive around looking for property.
One of the major drawbacks of this type of strategy is fierce competition. As many investors have adapted to this strategy, the market is getting saturated. Apart from usual real estate investors, you will have completion from big players called iBuyers. Zillow, Redfin, Opendoor, etc.
You should also know that the profit margins of most micro-flip businesses are low as it is a less profitable high-volume strategy. You need to manage your expectations because you won’t make as much money in any market as you would with other real estate investment strategies. If you’re microflipping, be prepared to close a lot of deals if you want a high-paying profile.
Micro flipping is a good option for individuals looking to kick starts their real estate investment profile. Make sure that you do your due diligence about the property and the area you are planning to conduct your business.
It is also important to use proper online tools that help you to find potential properties that you can micro-flip.
If you are planning to buy a home through a mortgage, you would have to pay closing costs as part of your mortgage transaction.
As a buyer, you would always try to get a mortgage with the lowest closing cost. If you are a veteran or active member you are eligible to take a VA loan to purchase your dream home.
One of the biggest benefits of a VA loan is that it limits the fees the lender can charge you as your closing cost.
In this post, we will learn all about VA non-allowable fees and how you can keep your closing costs under control by using them.
In simple words, the VA non-allowable fees are the fees that the lender cannot charge a borrower when they are getting a VA loan. VA loans are backed by the US Department of Veterans Affairs.
The VA home loan program strives to provide an affordable home-buying experience for veterans, so it’s no surprise that the VA controls the amount veterans will pay at the closing of a VA loan.
Non-allowable VA fees are fees that the VA prohibits lenders from charging borrowers during the closing process.
VA loan borrowers should not have any of the nonallowable VA items in their loan estimates. When you take out a home loan, the list of fees is huge, so it is very important to know what you should and shouldn’t allow for your loan.
The VA places restraints on VA mortgages to help make home ownership affordable for borrowers that are qualified.
Many VA loan fees are not allowed, which means that VA borrowers may not have to pay the fees that are commonly paid in conventional mortgages.
Here is a list of VA fees that a borrower cannot pay:
Here is a list of VA loan fees you should know that the lender is allowed to charge:
VA mortgages have strict requirements regarding how much the buyer can pay in fees. If the expense falls into the VA’s non-allowable fees category, someone else will need to cover those expenses. In some cases, the seller pays the VA loan fees.
In other places, the real estate agent or the lender may cover these costs. Keep in mind that if the seller pays VA non-allowable fees, these fees may be included in the contract in another way. A seller may add these costs to the home’s sales price to cover the difference.
Every situation is different when it comes to closing costs and fees associated with acquiring a VA loan.
VA nonallowable fees are on set to ensure affordable financing choices for borrowers eligible for VA loans to buy a home.
This makes the VA loan option one of the best options for VA loan borrowers by saving a good amount of money on their closing costs.
Refinancing your current mortgage or obtaining a home equity loan could be a daunting process.
As a borrower, it is important to know your rights and privileges when you are refinancing your mortgage or getting a home equity loan or line of credit.
One such important right that as a borrower you need to know is the right of rescission. In this post, we will understand what is the right of rescission in detail.
A right of rescission, also known as a right to cancel, is designed to give a borrower a “cooling off period” that provides time (usually three days) to cancel the loan after it has been accepted by the borrower.
As an extension of the Truth in Lending Act, this right helps protect borrowers against unfair and unethical lending practices by giving them the right to cancel the loan within the rescission period.
In addition to the right to rescind option, this right allows you to apply for a refinance or home equity loan with a new lender.
If you find out that the loan provided by your current lender has higher fees or interest rates, you can cancel the loan with the current lender and apply with another lender that can provide better terms for the loan.
According to the CFPB, the three-day rescission period begins on the first business day after signing a loan agreement and all the closing disclosures are submitted. The rescission period is for 3 business days including Saturdays and excludes Sundays and national and public holidays.
For Example, if you have signed the final documents for a mortgage refinance on Friday, you would have until Tuesday midnight to exercise your right to rescind.
TILA does not provide a formal way for consumers to exercise their right to cancel. However, the lender must send the borrower a notice indicating the right of withdrawal, which must include the procedure the borrower will use if the borrower wishes to cancel the transaction.
After receiving this document and signing all other documents, the borrower has three business days to review and change the decision.
If you decide to withdraw the loan application within the deadline, you must clarify your intention by following the procedure described by the lender.
The 3-day cancellation policy is not available over the phone or in person. In general, you must complete the process by indicating in writing your intention to terminate the contract.
In addition, the borrower needs to document the time the notice was sent to prove that the cancellation was made within the rescission period.
The Right of Rescission is created to protect borrowers from predatory lending practices by some lenders.
During the rescission period, the borrower can get the deal checked by a trusted financial advisor to ensure everything is right.
If the borrower is taking a cash-out, in these three days, the borrower can give a second thought to know if the deal is affordable and making good financial sense.
It is a great feeling of freedom when you become a homeowner. However, you might need to make sure that you have the complete ownership right of the land and the property built on top of it so that you have the freedom to modify it as per your requirement.
In this post, we will be learning about fee simple in real estate which is one of the most common types of complete ownership in the country.
A fee simple in real estate is complete and permanent ownership of land and any buildings or structures on it.
In fee simple ownership, the owner owns the land outright with entire rights to modify the property as required keeping the zoning parameters in check.
The fee simple ownership is only related to real estate including land, immovable home structures, and any property directly attached to it, such as roads, ponds, machinery, or buildings.
In most parts of the country when an individual purchases a home, it is generally bought under fee simple ownership.
This means, you own the land and everything that sits on it with the rights to modify the structures as you see fit, and your name is on the title.
In the case of apartments or condos, the owner of the individual apartments will receive a fee simple with a full right for the unit subject to the contract which is called a restricted covenant.
All the owners have a common right to use public places and carry specific responsibility to maintain these areas.
You have the right to sell land and buildings whenever you want. You can also transfer this property to anyone you want.
Being said that, the owner could still lose ownership of the land and the property. If the owner in fee simple ownership defaults on property taxes or commits any violation, the government agencies can place liens on the property.
These interested parties can repossess the property through a foreclosure process.
There are two types of fee simple ownership in real estate, namely absolute fee simple ownership, and defeasible fee simple ownership.
It is the best form of ownership for a real estate property. In this type of fee simple ownership, the owner has complete rights and freedom to do any modification that they like on the land.
There are just a few things that the owner has to adhere to such as local laws, zoning laws, and liens.
Some zoning laws restrict property owners from operating retail outlets in areas designated as residential and from paying local property taxes. You have the right to sell, transfer or develop the property according to your wish.
While passing the property on to your heirs you are allowed to add certain circumstances to the final settlement.
Some conditions state that the main building cannot be demolished and others may state that the property stays in the family so the future heirs cannot are unable to sell it.
You can also choose to be the sole owner of the land and not give it to anyone as long as you live. As long as you pay your mortgage and property taxes, you won’t be in trouble with the law or with individuals.
There is a slight difference between Absolute Fee Simple ownership and Defeasible Fee Simple ownership. The power to the owner in Defeasible Fee Simple ownership is less.
If the owner meets specific conditions set by the previous owner, he or she will have full ownership of the land for life. If the owner violates these conditions, they might lose ownership.
For example, the previous owner may set a condition where the new owner should always keep the property residential.
To convert that property into a hotel or other place of business would be to violate the covenant contract and you might lose the ownership of the property. In such an instance, the property would be returned to its original owner.
Fee Simple in Real Estate is the best choice for those who want the freedom to transfer, modify and maintain their property without any restrictions.
When you buy real estate, you need to exercise your rights, so make sure your ownership is clear and you adhere to the changes in state law.
When you are buying or selling a property, the title of the property plays a significant role in the transaction.
The title of the property is used to determine the rightful owner of the property and ensure there are no encumbrances.
One such important term related to title is title warranty. In this post, we will understand what is a warranty of title and its importance in detail.
Before we dive deep into this topic let us first understand the difference between a warranty deed and a warranty title.
A warranty deed is a legal document used to transfer the title or the property from one owner to another in a real estate transaction.
It is a document in which the ownership of the property is recorded legally.
Warranty of title is an assurance by the seller that he can legally sell the property and that there are no liens or legal claims on the property.
The party holding the lien on the property has a portion of the property under a legal claim for the amount that is owed by the homeowner.
The most common types of liens are tax liens, mechanical liens, or mortgage liens.
The property receives a clear title state where there are no liens on the property. Usually, the title company is responsible to search the title for any claims or liens and report if the title is clear for the property.
Title warranty is not provided in other types of deeds like a quitclaim deed. In a quitclaim deed, there is no guarantee of clear title, but the grantor effectively waives his interest in the property.
If a title issue arises later, the buyer will not have the protection that a title warranty would provide.
A title warranty is automatic in most property sale transactions, but if the seller is acting as an agent, no title warranty may exist.
This case may occur in a situation where the auction is taking place for example, in a real estate sale.
In such cases, the seller of the property is not the owner, so he may not be aware of another party’s rights on the property.
A title warranty can give the buyer of the property legal rights to sue the seller if there are any claims or problems with the title of the property.
For example, an heir of a previous owner may have an outstanding claim on the property that is not reported by the seller.
The buyer can take legal action to recover the money he invested in the property purchase and the damages caused to rectify the issue.
Other risks of completing a transaction may include ongoing disputes over the scope of defining the property boundaries.
Adjacent property owners may say that the property line is different from what the seller presented to the buyer. Bills for unpaid invoices and taxes may exist, making the transaction difficult.
If the property in question doesn’t have any outstanding liens and the ownership of the property is established successfully, the property will receive a clear title, and the seller can then provide a warranty of title to the buyer without any impediment.
A title warranty protects against risks that would make the property less valuable to the buyer.
Common title risks are as follows:
If a property has any of the above-mentioned attributes, the property will not receive a clear title during the title search.
An unclear title can require an expensive legal process to rectify the issue. These added costs may drop the value of the property and make it difficult to sell.
A title warranty protects against these risks by ensuring that the seller has a clear title and by giving the buyer the right to sue the seller if there are any of the above-mentioned issues with the title.
Warranty of title not only protects the buyer from any title issues but also helps the seller to have peace of mind and confidence that the transaction will go smoothly.
As a seller, it is suggested that you speak to your title company to make sure that the title of the property that you are selling is clear.
If you are planning to buy a new property with less than a 20 percent down payment, your lender will add mortgage insurance to your monthly mortgage payment.
The mortgage insurance works differently based on the type of loan you apply for. In this post, we will be talking about upfront mortgage insurance premiums (UFMIP) in detail.
When you apply for an FHA loan, you as a borrower need to pay a specific amount at closing called an upfront mortgage insurance premium. The actual FHA upfront mortgage insurance amount is 1.75% of the total loan amount.
The FHA UFMIP is usually added back to the loan amount instead of paying in cash. Your lender then pays the UFMIP funds to HUD which helps protect lenders and FHA in the event of default on that mortgage.
For example, you are planning to buy $350,000 with an FHA loan and a minimum down payment of 3.5 percent.
This means the down payment amount that you as a borrower need to bring at closing is $ 12,250.
At the time of closing of your home purchase, you’ll also need to pay an upfront mortgage insurance of 1.75% of the final loan amount, which is the mortgage that you are taking to buy the property.
If the home is $350,000, and you’ll put down $12,250, you’ll pay 1.75% on $337,750, which is $5,910.63.
This means your total cash to close required would be $18,160.63 plus the fees and closing costs charged by the lender.
Though mortgage insurance is also applicable in conventional loans if the borrower makes less than a 20% down payment called private mortgage insurance (PMI).
This is collected by the lender every month along with the monthly mortgage payments.
If the borrower decides to refinance the current FHA loan within the first 36 months after the closing date, the borrower will be entitled to a refund for the unused portion of the mortgage insurance premium.
According to the experts, the reimbursement is based on the first upfront mortgage insurance premium and is reduced by 2% each year until there is nothing left to reimburse.
Many people are unaware that if you pay off your mortgage insurance or refinance your FHA loan to conventional or sell your home within 5-7 years of ownership, you can usually get a refund.
This means you can still get a substantial refund after paying your FHA loan for all those years.
Homeowners can refinance and cancel their mortgage payments after 5 years if they take out an FHA loan before June 2013.
Homeowners must maintain 22% of the equity in their home and all monthly mortgage payments must be made on time.
Homeowners with FHA loans issued after June 2013 must refinance their existing loans into conventional and must have a current loan-to-value ratio of at least 80%.
FHA loans could be a great option for a borrower with limited cash in hand for buying a house, however, ensure that you are prepared for a huge UFMIP along with an annual MIP.
There are conventional loans with low down payments that you can get with no upfront MIP.
It is best to compare multiple options so that you can make an informed decision and choose the one that is most cost-effective and affordable.
If you are thinking of applying for a mortgage to buy a property, you have many loan programs available at your disposal.
Most of these loans would require income documentation as the lender would need to know if the borrower applying for the loan is making enough money to repay the loan.
However, there is one mortgage loan that does not require income documentation or verification. In this post, we will understand what a no-doc loan is in detail.
No doc mortgage, also known as low doc, no- income-verification, or stated-income mortgage is a type of private money loan program in which the borrower is not required to submit tax returns or verification of income.
Instead, these loan programs are approved based on an agreement from the lender that the borrower can repay the loan in the future.
Because income is not easily verifiable, it is common for people (including self-employed borrowers) who do not have a regular income to choose to go for this type of mortgage.
Although this type of mortgage is risky, there are generally no regulations and the borrowers have to pay higher down payments compared to a traditional mortgage.
In a regular mortgage, the borrower needs to provide income documentation for income qualification.
To prove your income qualification the lender would require your recent paystubs, W2s, and/or tax returns.
Lenders want borrowers to be able to repay their loans by proving that they have a consistent and dependable income.
Of course, this is in addition to other parameters that are required for a borrower to qualify such as loan to value, debt-to-income, and decent credit scores.
However, some mortgage loan programs may not require proof of income which is called a no-doc mortgage. In this type of mortgage, the borrower has fewer documents to provide.
Instead, the lender would request a declaration from the borrower stating that he or she would be able to repay the mortgage.
These loans are generally given and are best suited to individuals with no source of income, the self-employed, temporary workers, or new immigrants.
No documentation mortgages do not comply with the Consumer Credit Protection Act which states the lender should verify the potential borrower’s finances.
As there is no income verification required, these types of mortgages are risky for lenders. Since 2010 after the execution of the Dodd-Frank Wall Street Reforms and Consumer protection act, no doc mortgages have become less popular.
This is due to the guidelines stating all mortgages are required to have all the documentation.
No doc mortgage could be a good option for investors and self-employed individuals; however, it is difficult to find a lender who provides this type of mortgage.
You can search online for lenders who are providing such kinds of loans or speak to your trusted mortgage advisor for such options.
As we all know that in the mortgage industry the interest rates change quite often.
When you are looking to refinance your current mortgage or buy a new home with a mortgage the lender or the bank will charge you an interest rate for the loan that they provide.
In a market where the interest rate is rising, you must lock your loan with the lender before you lose on a good interest rate. In this post, we will learn what is a loan lock and how it works.
A loan lock, also known as a mortgage rate lock is a tool that allows borrowers to “lock” an interest rate for a mortgage for a set period usually 15 to 60 days.
If the loan does not close within the lock-in period, the borrower may extend the period by paying an additional fee.
Let’s say you lock the interest rate at 5% for 15 days and after 10 days the interest rate increases to 5.5%.
You will still qualify for 5% interest, which will keep your loan lower over the long term. Thus, the rate lock protects the borrower from rising mortgage interest rates.
Locking in the loan assures the borrower that the lender will provide a loan at a specified interest rate at the time of closing. In most cases, lenders provide loan estimates that show the interest rate at the time of application rather than at the time of closing.
The listed interest rate also includes the lender’s profit margin. Interest rates can rise or fall before closing, so a mortgage rate lock protects borrowers against rising interest rates during the lock period.
Lenders sometimes offer a loan at a certain rate plus a few points.
The points represent the fees you pay at the start of the loan to get a lower interest rate for the life of the loan.
If the interest rate drops during the lock-in period, the borrower can choose to withdraw the application.
This type of withdrawal is called the risk of loss for the lender. However, the borrower must be very careful to ensure that the mortgage loan lock agreement allows for cancellation.
In some cases, when the interest rate drops during the lock-in period, the borrower may have the option of adjusting the new lower rate using the float-down facility.
This option may be an additional cost to the borrower as it has a potential risk for the lender.
Mortgage rate locks usually may last for 15 to 60 days. At the very least, it should include a reasonable amount of time for the borrower to process their loan application. Sometimes this lock-in time can be as short as a few days.
A borrower can negotiate the terms of a rate lock and often extend the term of the lock for an additional charge or slightly higher interest rate.
Mortgage rate loan locks are popular with borrowers for a reason. Here are some of the benefits of locking your rate before the loan process begins:
Mortgage rate locks could be a good option, but it’s not perfect. Below are two disadvantages of locking your loan:
A loan lock could be one of the best options if you are looking to buy a new home or refinance your current mortgage.
As a borrower ensure that you check the market condition so that you can anticipate the rate lock and get the most out of the mortgage rate lock.
Ensure that all the required documents are submitted on time so that the loan is closed before the lock period expires to avoid additional extension charges.
Just like borrowers borrow money from banks when they require financial assistance, banks might also need financial aid to continue their lending business.
When you take a loan, the bank will charge you an interest rate according to the current market for providing you with the money you need.
Similarly, when a bank borrows money from another bank or lending institution, there is an interest rate that is charged based on the federal funds rate. In this post, we will understand what is the feds fund rate in detail.
The federal funds rate is one of the Federal Reserve’s important tools for managing US monetary policy.
As it affects everything from the annual percentage rate (APR) that individuals earn on savings accounts to the interest rate individuals pay on their credit card balances, the Fed funds rate essentially determines the cost of money in the U.S. economy.
The term Fed funds rate refers to the interest rate index set by the FOMC (Federal Open Market Committee).
This rate index is the rate at which commercial lenders and banks borrow and lend their excess reserves overnight to each other.
The FOMC, the Federal Reserve’s policymaking body, meets eight times a year to set the index for the fed funds rate as a part of its monetary policy. This policy is used to encourage economic development.
This rate refers to the interest that banks charge other financial institutions for lending them excess cash from their reserve balances overnight.
According to the law, banks must maintain a reserve that is equal to a certain percentage of their deposits in an account with the Federal Reserve Bank.
The amount of money a bank must keep in its Federal Reserve Bank account is called the minimum reserve requirement and is based on a percentage of the lender’s or the bank’s total deposits.
Banks and lenders are required to maintain money-making accounts with the FED banks to ensure they have enough cash to cover deposits and other liabilities.
Any money in their reserve that exceeds the required level is available for borrowing from other banks that may be falling short of finances.
The end-of-the-day balances in the lender’s or the bank account averaged over two-week reserve maintenance periods are used to determine whether it meets its minimum reserve requirements.
If the bank has a balance of more than the minimum required reserves in the account, the additional reserves could be used for lending to other financial institutions that are expecting a shortfall of funds.
For this overnight transaction between two banks, the lending bank will charge an interest rate based on the Fed funds rate.
The Federal Open Market Committee decides about rate adjustments based on important economic signals that may show signs of recession, inflation, or other problems that can affect sustainable economic development.
The signals may include factors like the durable goods orders report and the core inflation rate.
The index for the federal funds rate has changed widely over the years in response to the different economic conditions. Due to inflation in the 1980s, the fed fund rate was set as high as 20%.
While during The Great Recession of 2007 to 2009, the rate dropped to a record low target of 0% to 0.25% in an attempt to motivate economic development.
The federal funds rate doesn’t just affect interest rates for the financial institutions. It also affects the entire country’s economy. The feds funds rate affects the stock market as well.
For example, when the Fed cuts rates, stock markets typically rise because borrowing costs for public companies must fall, making it cheaper to expand their businesses and increase profits.
But when rates rise, equity markets can become more difficult as borrowing becomes more expensive and borrowing banks are charged with higher rates.
If you are looking to buy or sell your property you must have an idea about the property prices in your area.
Many parameters affect the property prices in an area. These parameters help to determine the house price index in various regions of the country.
In this post, we will learn what is the house price index is in detail.
The HPI is a Federal Housing Finance Agency’s (FHFA) index that indicates the prices of single-family homes.
The HPI measures home prices based on information from home purchases and mortgage refinances in all 50 states and more than 400 US cities since the 1970s.
In addition to serving as an indicator of housing price developments, it also functions as a tool for understanding estimated changes in mortgage prepayments, housing affordability, and mortgage defaults.
The HPI is compiled by the Federal Housing Finance Agency (FHFA) using data provided by the Federal Home Loan Mortgage Corp. (FHLMC), commonly known as Freddie Mac, and the Federal National Mortgage Association (FNMA), commonly known as Fannie Mae.
HPI is derived from transactions like conforming and conventional mortgages on single-family homes.
This index is measured based on the resale or refinancing of the same properties by calculating their average price changes after every transaction.
The home price index report is usually issued quarterly, however, since March 2008 a monthly report has also been issued regularly.
The data for HPI is collected from a review of mortgages purchased or securitized by Freddie Mac and Fannie Mae.
The HPI is a measure of changes in single-family home prices that began in the mid-1970s to the present using complex analysis. It measures the average change of home value during the resale or refinancing transaction of the same property.
The home price index is a “constant quality” index because changes in housing quality are supervised by tracking the same single-family homes over time. The HPI displays nominal gains as it is not adjusted for inflation.
The data represented in HPI includes tens of millions of US home sales. Because the index tracks home sales over time, it provides an overview of changes in home price at the national, state, census, county, metro, and zip code levels.
The HPI is one of several economic indicators that investors use to gain insight into broader economic trends and potential movements in the stock market.
Rising and falling real estate prices can have serious consequences on a country’s economy.
Rising prices generally create more jobs, boost confidence and encourage higher consumer spending.
This opens the gates for greater aggregate demand, improving the country’s gross domestic product (GDP) and overall economic growth.
However, when real estate prices fall, the opposite happens. Consumer confidence falls and many organizations profiting from the demand for real estate initiate laying off their employees which could sometimes cause an economic recession.
The HPI is a free, publicly available measure of US housing prices. FHFA. The index is calculated based on single-family mortgages purchased or securitized through Freddie Mac and Fannie Mae, the largest mortgage GSEs in the United States.
The HPI provides a tool for understanding housing market trends that play an important role in the economy.
For example, researchers can use the HPI to understand changes in housing affordability, prepayments, and mortgage defaults.
A house price index is a free tool provided by FHFA publicly. This tool is mostly used by researchers to understand the economic trends that help investors to invest their money in the real estate market at the right time to get maximum returns.
You as a homeowner or home buyer can use this indicator to analyze the property prices in your area if you are looking to buy or sell your real estate property.