Stay Focused: How to Evaluate a Real Estate Market
Randal: Hey, welcome back to Stay Focused, Focus Real Estate's weekly video blog. This week we'd like to talk a little bit about how to evaluate a real estate market.
Erik: So the real estate market is many markets. You've heard the old saying real estate is local. But we like to start out with looking at the big picture, what's happening across the country, the economy, we've talked about some of the economic indicators and stuff. But look at the macro what's happening overall in real estate trends across the country.
Randal: I've said it 100 times. We certainly continuing to watch those trends nationally. One of the biggest trends is, of course, people moving to the city. But those numbers that are national numbers are really important for us to know. We drill down even further than that because when we're really helping our buyers and sellers make a decision, we get very, very micro, from price per square foot to evaluating the differences in a single family house between what a Victorian home sells for. There's a difference to what a cape home sells for that's exactly the same size.
Randal: So it's really important to know all these very, very micro details and micro differences within a market.
Randal: So really even getting down and comparing the number of bedrooms and all of that.
Erik: Then there's condition and from one street to another, one building to another. That's why some of these big platforms on some of these big real estate websites, they can't really give you a great indication of specific price because it gets very specific. Everything is so different.
Randal: Then once we get down to that macro level, we actually start to dissect a little further, look at what are our list to sell ratios? So what was the list price of a property and what was the sale price?
Erik: The number of days on market in a specific area, or for specific types of properties, whether it be single families, Victorians versus capes.
Randal: Condos, multi family.
Erik: Condos versus condos.
Randal: Indeed, indeed. And then really getting down into absorption rates.
Erik: So we're looking at all of those. Most of those numbers, we talked about this in the past, are lag indicators, numbers that are out there, data that's out there, based on what's already happened.
Randal: Yes. But really, when you come to us I feel like our value for you is not so much what's happened in the past. We do have a lot of expertise in evaluating these numbers, in helping you sort through the data to make sure that you can make the right decisions. But really when it comes down to it, it's the leading indicators that are more important. So we're the eyes and the ears on the ground doing open houses every week, meeting with buyers, meeting with sellers to understand [crosstalk 00:02:45].
Erik: Reviewing offers.
Randal: Reviewing offers.
Erik: Seeing what decisions are being made currently.
Randal: So if any of that makes sense to you, fantastic. If it doesn't and you need some more information, please shout out and let us know how we can kind of help you through these. Thanks for watching today everybody. Don't forget to stay tuned.
Erik: And stay focused.
Erik: Hello? Is anyone home?
Randal: Give me a box to stand on.