The value of a home is far from concrete, and these outside dynamics can have a huge impact on the housing market, as well as the prices of individual homes.

Here are a few factors that can affect the price of a home:

Economy. Perhaps the most influential of all the factors is the economy. When the economy is in a recession, people have less money to spend. Because of this, they may not be able to meet their mortgage payments, and their homes could possibly go into foreclosure. If this happens, the home will likely sell for much less than it would have prior to the economic downturn.

 Location. Another important factor in the price of a home is its location. Oftentimes, location is on the top list of priorities for someone looking to buy a new home. For instance, if a home is located near the city, it will be priced much higher than a home in a remote rural area.

Quality. A home’s quality also plays a role in its price. If the home is in disrepair, if it is older, or if it needs major work done, it will be priced much lower than a new, well-maintained home.

Neighborhood. The neighborhood a home is located in also affects the amount people are willing to pay for a home. If there is a lot of crime in the area, people are less likely to want to live there. This is a huge factor, as many people buy homes with the intent of having children one day.

Interest rates. Lastly, interest rates play an important role in the price of a home. If the interest rates are high, people will have less money to spend on the actual house. However, if interest rates are low, it is possible that they will be able to afford a more expensive home.