Real estate is best examined on a local scale since a rapid sell-off in south Florida, or falling values in San Diego can have little bearing on what a home is worth at any given point in your neighborhood.

Although it is best to focus on your local area, keeping an eye on the big picture is prudent.

In part two of our five part series on "When is the Best Time to Sell A Home" we examine some of the broader national issues which affect the overall atmosphere of home buying and selling.

Interest Rates and the Availability of Mortgage Money

To begin to address these issues is rather redundant since the current issues facing the mortgage industry are changing everyday and are covered well enough by experts-for many-the writing was on the wall. Suffice to say though that when money is more expensive and harder to obtain, fewer people can afford or qualify for a home. This and the high median price of homes can be illustrated by what is referred to as the Affordability Index; when the affordability index is low, fewer buyers are able to purchase a home and less demand can mean more supply and falling home values.

In June of 2007 we saw interest rates rising and although they were still near historically low levels, the perception that they were high may have changed the minds of prospective buyers. Whether uneasy about if they should wait for lower rates and purchase more home, or higher rates made home ownership simply unaffordable, fewer sale transacted.

Watch for Part III-How Consumer Confidence affects buyers and seller…

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