What is a key takeaway from the Principal of Supply and Demand regarding buyer interest?

The principle of supply and demand is fundamental to understanding how market forces influence property values. Buyer interest plays a crucial role in this dynamic, as it directly impacts market value. When demand for properties rises—due to factors such as economic growth, population increases, or improved local amenities—this typically leads to higher prices as buyers compete for a limited supply of available properties. Conversely, if demand decreases or if supply exceeds demand, property values can fall.

This principle applies across all property types, not just those of high value or specifically commercial properties. Hence, recognizing buyer interest as a critical component in determining market value is essential for anyone studying real estate. It reflects the broader economic principle that prices are driven by the balance between what buyers are willing and able to pay versus what sellers are willing to accept, encapsulating the core idea of the supply and demand theory.