Savvy agents and brokers are always looking for potential market trends. How do they know where to look and what to look for? Here are some tips for getting ahead of the pack.
Compare Markets. You’re used to reviewing comp properties to determine price points. Why not comp markets? Make a list of your city’s relevant characteristics. Which other cities nationwide have similar traits, and what’s going on there?
You can even glean useful information from comparisons based on a single metric. If your prospects are worried about traffic getting worse, the behavior of residents in cities with known congestion problems could offer clues about how to better serve them.
It is a good idea to network with real estate professionals in similar markets. Check in a few times a year to compare notes.
Ask “What Will Happen in Five Years?” Agents and brokers should stay updated with what’s going in their city, the real estate market, and the economy in general. Any time you read or listen to the news, ask yourself, “How will this affect real estate?” and “What will happen in five years?”
Some stories have obvious consequences: redrawn school boundaries or a major employer going out of business will change the market. Others are more subtle. Are taxes increasing? Are new neighborhoods becoming cultural hot spots?
Even national or international news may be relevant to your local real estate market. What starts in a big city or abroad today may be at your doorstep before long. Just look at rideshare apps and short-term rentals.
Go to the Source. You can learn a lot about current trends, and forecast future trends, by studying data: net population growth, year-over-year median housing prices, and elementary school enrollment, to name three. There are many publicly available databases you can review. Skim them and see what patterns stand out.
Talk to Demographics Outside of Your Own. What’s visible to one group of people may be invisible or irrelevant to another. Talk with colleagues, neighbors, friends, and family in different circumstances than your own and ask what they are seeing—not just in the real estate market but in other facets of life. Your graduating niece may have different experiences and opinions than your retiring uncle. Your neighbor who owns a rental property may have different considerations than a cross-town friend who lives in a rental home.