When house prices for a region are announced there are two key groups interested in the data when it comes to consumers: the homeowners in the region and the potential home buyers.  For the homeowners the house prices will compute into either more or less equity in their property.  For potential home buyers the home prices will determine if their budget can bear the area’s property prices.  The house prices can of course equate to much more for these two groups beyond the obvious.

For a homeowner that is watching house prices fall or rise in their area it may be a mere observance.  The economy is of course in a growth period and while it is struggling, there will be a time when it will be robust and healthy again.  So homeowners that are seeing a decline in home prices are expecting that at some point in the future they will rise again.  This is hopefully very true, but should that homeowner be considering a remortgage in the near future before all health returns to the housing market, they are losing built equity.  As that equity goes down, not only does it limit the amount of lending available but it also has an impact on the remortgage rate to be realized.

For the potential home buyer there is the hope of falling house prices so they spend less for the property they are purchasing.  Yet, when it comes to a house purchase a home buyer does not want to look for the super discount caused by fast declining prices.  If those prices continue to decline the new homeowner could find themselves in negative equity, where the amount owed on the property is more than what the property is worth.  It would be good to find a deal, but a moderate deal in an area where prices will be expected to rise in the future to help increase the value of the property.  A home buyer needs to be looking for an investment as much as a home.

House prices while falling are still considered by many to be bringing on a correction from much inflated values of the past few years before the financial crisis.  So a correction is still occurring according to many experts.  If a remortgage is under consideration or a house purchase, then it would do well for the homeowner or the home hunter to keep an eye on those very important house prices indexes that will be coming out every month.