Analyze the Market

Overview

It’s easy to get caught up in the hype of the real estate market, especially when it gets hot, or things begin to unravel. All asset classes go through their ups and downs, however, as a buyer you need to evaluate the long-term projection and try not to get tangled up in the current noise in a hot or cold market.

At Equity Vantage Real Estate, our objective is to give you an equity vantage over others in the marketplace by putting all the tools in your hand for you to make the most informed decision on your biggest investment, your home. Not only is it about the transaction and the perceived value, it is about maintaining and increasing the value of your home by reinvesting into it and taking care of the day-to-day activities that can lead to bigger issues down the road and erode value.

As a buyer, you also should do your own research to form your own opinions in addition to the support that our advisors provide. There are various tools you can use which have been outlined below.

Understand the Real Estate Data

Know what all the terms mean in regard to the health of the market. Our monthly market reports outline this for you, including what current inventory levels, absorption rates, days-on-market, list price as a percent of sales price, pending sales, interest rates and more all mean. We bring this together in our monthly market analysis report that does in depth analysis and trending, so you are aware of the state of the market. We compile data from title companies, the MLS and economic indicators to constantly evaluate are we in a sellers’ market, buyer’s market, or stable market and what does that mean for you in your purchase in order to compete.

Understand the Economic Data

Be able to research and understand the broader economic data in conjunction with the local data by asking question such as:

• What is the current state of the broader economy, are we in an expansionary or contractionary point of time?
• Are we in a rising interest rate environment or will the Fed be looking to cut rates?
•  What is going on in the local market and how does that differ to the broader economy?
• What are the employment stats, are a lot of companies hiring in the area or have there been a lot of lay-offs?
• Are there other demographic trends that are occurring in the local market, including are more people relocating, is there an exodus, are new employers coming into town, what industries are driving the growth, etc.
• Is the area going through a reinvestment phase?
• Are the schools highly ranked and does this attract a lot of families?
• Is there a lot of land to develop or is it in short supply?
• What are homebuilders doing in your area?
• Are investors coming into the market?

Based on understanding such questions, target areas with solid schools, major employers, and moderate population growth. Finding areas where there is reinvestment, homebuilders are acquiring land or building new homes, or a major employer announces a new facility. Following the money behind major players can be beneficial as they are aggregating and have teams do huge amounts of analysis on the market.

Evaluate the Neighborhood of Interest

What are current trends in the neighborhood, has it been well kept, are there a lot of listings or buyers trying to get in. Is it an up-and-coming neighborhood, one under redevelopment, or is it always in high demand? Drive the neighborhoods and get a feel for the day-to-day and see if you picture your life here while answering these questions. Are there properties of interest that are within your budget or are they out of reach and you should explore elsewhere. Our local advisors will provide neighborhood tours to point out areas of interest and proximity to local schools, shopping, healthcare, and employers.