HOW TO REALLY ANALYZE ANY REAL ESTATE MARKET
by: Remie Longbrake | published: February 1, 2020
Location. Location. Location! That’s what we are always told. From the early days of investing in real estate, heck, even buying a home, location matters. As me being an investor, location is everything, as is being a home owner.
Rule of thumb is to start local, know your market. Lean on agents who have experience in your area and get their expertise. The problem is, at least currently prices are very high in some areas. Depending on your investment strategy, it may not always be worthwhile to look in your own backyard.
The great thing about the Internet is information is everywhere. No longer are we required to drive around town looking for deals or spending hours at the courthouse looking up property records.
It truly is easier then ever, although, there are still plenty of risks involved. If you are willing to do your home work, study the market, and investing accordingly, great rewards can be had.
So, below are some great resources for the savvy investor to use to study a market and make real estate investing much simpler and more appealing to those starting out or experienced alike. Of course, this data is handy too even for those moving to a new area across the county or the country!
1. Your Agent
Likely the best source for a given market is a real estate agent or broker who know it. Depending on your market there may literally be hundreds to choose from. Most of the time starting out you can simply call into their office and just ask for someone who is knowledable about the type of real estate you are looking for. Now they might not be able to help on specific investing strategies, such a flipping or buy and holds, or multifamily for instance, however, they can fill you in on the schools, what areas are hot, general prices, and what properties are currently listed.
Certainly not obligated to purchase anything, however, nothing hurts if your serious, to have them help you find a property that you may be interested in. If something does come up, they can show you the property which is a great starting point.
2. City-Data
City-Data.com has tons of information. Since I love graph and numbers in general, I use this site quite a bit. It lists demographics, population, income, crime rates, even the weather. It’s a great indicator of the overall picture of a certain locations, which you can use to compare it to other markets that you may be interested in investing in.
I find for the most part stats are fairly current. It does use census data, which here in 2020 will be a great update to have available. Regardless, knowing what the key indicators are is extremely valuable.
3. Real Estate Websites
Your investing journey isn’t complete without the juggernauts of real estate, such as Realtor.com, Zillow.com, Craigslist.com. These sites and many others offer a wealth of info. Zillow, especially has a feature, at least for single-family of a market value, even if a home is not for sale. There are so many homes being listed and so much data, generally their guess, isn’t too far off. Realtor.com I use to look up homes that are mostly listed on the MLS and is also a great resource. Craiglist I believe is the original source for online listings. Although, kind of old school, you can still find some great deals, especially for off-market properties and seller finance deals.
4. School Searches
Anyone who has kids, or who plans to have a family, has a very keen interest in living in a good school district. Many times, this is the biggest factor for purchasing a home or finding a place to rent. Everyone wants to get their kids the best education available, so this is a key metric to have available.
For me, I’ve come across two very similar properties, same price, but in two different districts in the same city. Knowing the info from these districts was the push I needed to make my decision.
Some places I use include Niche.com, SchoolDigger.com, and GreatSchools.org. These are all fantastic places to start to educate yourself on the better school districts in a region.
5. Trip Adviser
Although you might not be looking for your next vacation, Trip Adviser is a really good tool to know what’s going on in a local market.
There are other sites (including Yelp), but I like it because it of seems to have good information and a good amount of reviews to base off of. People like attractions and things to keep busy and entertained. Finding the ballpark is easy, but there are a lot of unknown sights and quirk to a area you really wouldn’t know about unless someone told you. Even parks are generally listed, so this is really helpful. This takes some of the guess work out of the equation.
6. Bigger Pockets
For those not already in the real estate space, you may have not heard of this one. Although it’s been around a while, like 16 years, it was actually under my radar until recently.
It’s a great site really, they have tons of resources available to investors mostly, from books, a weekly podcast, education, blogs and more. What I like about there site is their forum section. You can ask questions about markets, investing, thoughts, opinions, etc. It’s a wealth of information, and for someone sorta new, just being able to ask questions, and it’s mostly free, which is a big help.
7. Connected Investors
This is another online community for real estate investors and those selling properties to connect. For the most part it is free, however, there are some paid sections. I use this to ask questions, connect with fellow investors, possible partner up, and generally help each other be more successful. It is sort of newer, however, lot of people are on there, and it’s certainly worth checking out for yourself.
8. Get in and drive!
Not much beats just getting in the car and driving around a given market. Your own eyes can’t be deceived if you actually see the property and neighborhood in person. What you thought was good about a neighborhood given someone’s perspective could be way off to what you were expecting. Markets do change. Although it does take time, you definitely want to see and study the market in person before investing.
9. Transportation
Evaluate the larger infrastructure of a market. Is there access to transportation within a reasonable distance? The closer you are to airports, trains, and major highways, usually the better. Many higher-paying jobs depend on having access to these types of transit. Where the money follows so the the real estate prices. Get in early enough and you can profit very nicely!
10. Jobs, Jobs, Jobs!
What’s the local economy like? What are the major employers? These are things I must know before investing. Are I look at the range of businesses. I like a variety, some manufacturing, retail, office, industrial. Then I look at the trends and possible future outlook. That can be tricky, I do study stock’s online even though I generally don’t invest their. I do want to know how their performance is and if an employer may be looking to relocate, what does that mean for the area. What is the future growth as well. I also sign up for emails from the county and attend local commissioner meetings when possible. That allows me to network and stay informed.
11. REIA’s
These are so valuable!f Real Estate Investing Associations are an investors best friend. Although not every market has one local, most highly populated areas do. Generally, these are about connecting with fellow investors and usually there is some sort of educational opportunities attached to them. So you can learn and meet at the same time. Most of the time people are willing to help plus give some insight on the local market. These usually not free however, but if there is one in your area, certainly recommend to check it out for yourself.
12. PropStream
Now I may be biased here, as I use this paid site, however, it is an absolute gem. Basically, it allow subscribers to lookup any type of property and really dive into specifics of the properties history, the square footage, lot size, who’s owned it, how much, property taxes, if their a lean on the property, etc. Now this info is certainly available at the county courthouse, but what I love is you can pin-point exactly what properties you are looking for. For instance, you could say something to the effect, an off-market property with an out of town owner, who’s home is vacant for 6 months, with high equity. It certainly helps save time. From their I can have them send a postcard or I can buy their email and phone number right off the site if I choose. Not bad!
13. Rentometer
For anyone doing rental properties, this is another great tool. Now it is paid, however, this site compares what the going rate for a rental is in a given market. This allows the investor to see what the potential revenue would be even before making an offer. Saves a lot of time and potentially a lot of money overall.
14. Google Maps
You can probably tell, I love tech. Never is there a better time to with see info in real time, maps included. A part of my research goes towards pulling up maps. I prefer Google, mainly because the data seems more accurate (not always), I can zoom into a street level and act is if I’m looking at a property head on, which is great too.
Another reason I like Google, but others too, is because I can pin-point where the local restaurants are in relation to the property I’m interested in or a region as a whole. I also look for shopping, banks, gas stations, etc. This is all very valuable as generally the closer you are to these hot spots the better the real estate in many cases.
Now Google is not the only player. I also like Mapquest and Bing are also worthwhile.
Hope this info helps you in your search for the right market. If you’re not already in the real estate investment space, these resources should really help speed up that process. As with anything, I recommend you do your own research, but if you want more info please reach out.
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