Local Market Research Real Estate Analysis and False Assumption #3. Proper local market analysis is critical if you are going to hold a real estate investment long-term and have capital at risk. Before we jump into analysis, first let’s clear up some false beliefs.
Local Market Research Real Estate Analysis – False Assumption #3
False Assumption #3 – There is No Need to Have Current Local Information, Demographics, Economics, or Hyper-Local Forecasts, Since Macro Metro Yearly Data Is Adequate. It is inappropriate to assume that the annual macro-level data on home prices is sufficient to make a sound decision about buying a home or investment property.
The local market analysis data for metropolitan areas, usually presented in terms of average or median prices, is not reflective of specific trends that may affect the local-level housing market. Market Needs Analysis and Local Market Research are important, and sometimes Free Competitive Market Analysis might help, but….these are NOT enough.
What specific developments or factors, could have a significant impact on home prices in a particular local community? Average prices of housing in New York City metropolitan area as a whole are much different than the average prices of homes in the Queens country. Local market analysis is Key to the investors. Local Market Research Real Estate Analysis and 14,000+ markets
Moreover, there are over 14,000 sub-markets or Census Block Groups in the New York Metro area, and there is practically NO correlation of the median of any large group, to the local block level, for ANY local block variable. As differences in home values further channel down to block levels, current local market analysis becomes more and more relevant in making a buying decision and assessing risk.
Therefore, substantial research into current local trends is needed in order to make the most appropriate and well-educated decision about buying a home or investing into a property that has a good potential to grow in value. With the Growth Maps real estate technology and local market analysis, it is easy to find the optimal investment or site selection.
Metropolitan area statistics on home prices are too general to suggest the true value of any property in a local community. Moreover, annual data is too old to be useful in making a decision about home purchase in today’s market. On the other hand, most available home price statistics fail to account for location-specific economic and demographic factors that drive demand and thus have the determining impact on both current and future home prices. Many annual price indicators also allow for a substantial margin of error, ranging up to 10 per cent, which makes any such global information irrelevant for the current local market. Local market analysis, on-the-other hand, is very accurate, since based upon local variables.
The Growth Maps gathers, sorts, filters and analyzes key determinants of home values down to block level. This includes evaluation of income, which traditionally has been the key driver behind the property price movements, business and job creation, marriages, migration, mortgage finance quality, and so on. It incorporates various complex economic and demographic variables into a model that produces simple and user-friendly output with dynamic-rendered maps at county levels highlighting locations with most promising properties.
For more information, watch our free demo video on our homepage, and download your FREE eBook titled: “What’s Next for Commercial Real Estate Technology: Leveraging Technology and Local Analytics to Grow Your Commercial Real Estate Business” at https://www.growth-maps.com/free-ebook/
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