BrokerBryant.com: Knowing Your Real Estate Market Is Crucial For Success.

Knowing Your Real Estate Market Is Crucial For Success.

tutas towne realty

Hi folks. I did an interview and one of the listeners posed a question that has been on my mind ever since. The question was "How do you learn your market?". It caught me a little off gaurd. Not that I don't know the answer but that someone in our business had to ask the question.

  • Knowing our market is what our job is all about.
  • Knowing our market is why buyers and sellers need us.
  • Knowing our market is what gives us confidence in our business.
  • Knowing our market is how we know where and who to market to.
  • Knowing our market is how we plan for the future.

Knowing our market is so important that if we don't know it we will surely fail. It's just a matter of time.

But having said all of that......"How do you learn your market?" is a very good question and one that I'm going to try and answer. To begin with, knowing your market means being able to answer the following questions if asked. There are many more but these will get you started:

  1. How many properties are for sale in your market today?
  2. What's the average price?
  3. What's the average days on market (DOM)?
  4. What's the median price?
  5. How many properties sold last month? Last 6 months? Last year?
  6. How many properties are currently under contract (pending)?
  7. How many of the sold properties were Short Sales? Foreclosures (REOs)?
  8. What's the "sold price to list price" ratio?
  9. What's the absorption rate (Active listings divided by a month's average sales)?
  10. Are values declining or increasing?
  11. Is inventory declining or increasing?

These questions are asking for essential market information that buyers and sellers will want to know. The answers to all of them can be found in your MLS system. I check my MLS hotsheet every day first thing in the morning. I want to know what is going on in my market. Make this a DAILY activity. And while you are at it go ahead and solicit the expired and withdrawn listings. Kill two birds with one stone. This one little daily exercise will give you market confidence AND you will also pick up listings. I've done this daily for 15 years.

By answering this next batch of questions you will become even more of an expert on your market. By knowing the answers to these you will be able to laser focus your marketing.

  1. How many total properties are located within your market?
  2. What's the average age of the folks that live there?
  3. Who's buying property there? Are they relocation buyers? Move up buyers? First time home buyers?
  4. What mortgage products are they using? FHA? USDA? VA? Conventional? Cash?
  5. On average how often do folks move OUT of your market?
  6. Where are they moving to?
  7. Who are the largest employers?
  8. What Real Estate Company does the most business? What agent? Listing side? Selling side?
  9. What percentage of business do they have?
  10. Who sells the most REOs? The most Short Sales?

Folks, you may have to dig a little deeper for the answers to these questions. Some can be found in your MLS. For others you may need to contact your Chamber of Commerce. Or you can check online at sites like ZipSkinny.com (just remember these sites will be far more accurate once the census is completed).

So that's it for now. Hopefully this post will get you started in the right direction. Let me know if you have any questions for me. Does this help?

 

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***I am NOT an Attorney nor do I play one on TV. Click the button below for my Bio.

The BIO for Bryant Tutas

 

 Tutas Towne Realty, Inc handles Florida real estate sales, Florida short sales, Florida strategic short sales, Florida pre-foreclosure sales, Florida foreclosures in Kissimmee Florida Short Sales, Davenport Florida Short Sales, Haines City Florida Short Sales, Poinciana Florida Short Sales, Solivita Florida Short Sales,  Orlando Florida Short Sales, Celebration Florida Short Sales, Windermere Florida Short Sales. Serving all of Polk, Osceola and Orange Counties Florida. Florida Short Sale Broker. Short Sale Florida.

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Comment balloon 31 commentsBryant Tutas • July 20 2013 04:19AM

Comments

BB, knowing your market is crucial. I know the stats and have them at hand because I write detailed market reports. And I try to attend every caravan to see what is new on the market first hand.

I feel very confident I know my market area.

Posted by Andrea Swiedler, Realtor, Southern Litchfield County CT (Berkshire Hathaway HomeServices New England Properties) almost 5 years ago

Great questions that we should all know.  And, we can even get a bit more knowledge about our special areas of concern.

Posted by Gabe Sanders, Stuart Florida Real Estate (Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales) almost 5 years ago

Your post highlights exactly the reason being a real estate professional is more than just a license!

Posted by Gary L. Waters, Broker Owner, Waters Realty of Brevard, LLC, ... a small office, delivering big service! (Waters Realty of Brevard, LLC) almost 5 years ago
Great points Bryant, the point that resonates with me is that knowing the market creates confidence. I'm with Andrea, writing market reports is a great way to stay on top of the market as well as caravans.
Posted by Rich Cederberg, eXp Realty Agent Albuquerque (eXp Realty) almost 5 years ago

My confidence comes from knowing the area if work in and the amount of success I have in my marketplace. I have to know my area and what values are, which is the most important part of being a realtro. All the other point s are also very important.  Thanks, Jim

Posted by Jimmy Faulkner, The Best Of St. Augustine (Florida. Homes Realty & Mortgage) almost 5 years ago

Bryant: Excellent questions - all of them. Here we have "brokers open" and those are very important in Honolulu because they are usually held within a week of listing. We have way too many listings overall (over 3,000) to keep track of everything on Oahu. But at least I can check out what's new every day, then follow up with those that interest me in certain areas.

Posted by Hella Mitschke Rothwell, Hawaii & California Real Estate Broker ((831) 626-4000) almost 5 years ago

Beyond knowing all the fundamentals about your area you describe in your post, knowing the streets and what is a good street and what is a rough street and why also seems to go a million miles with a client.  There is nothing more local knowledge than that.

Posted by Jay & Michelle Lieberman, Creating Calm in the Buying and Selling Chaos (Keller Williams World Class) almost 5 years ago

Bryant - I felt very uncomfortable  with a sizable market without borders, and it felt that  I won't be able to ever really know it. By virtue of being in a condo hotel right on the  ocean, we started working with condo-hotels and then extended to condos. It is a much smaller market. Of course, it limits me, but I love it when people call and I am in a car, I do not need to get to a computer to talk to them, as I know how many units are for sale in key properties, and which units these are, and what is the view, and the size and the price...

Gives me confidence

Posted by Jon Zolsky, Daytona Beach, FL, Buy Daytona condos for heavenly good prices (Daytona Condo Realty, 386-405-4408) almost 5 years ago

Bryant, the answers to these questions are essential, especially in today's market.

Posted by Sharon Parisi, Dallas Homes (United Real Estate Dallas ) almost 5 years ago

Bryant, knowing current real estate market for an agent is very important - specifically, knowing some stats that you can share with the clients make all the difference. Love the list of key statistics in your post. (and I did not know the answers to few questions in last set......ooops!)

Posted by Praful Thakkar, Andover, MA: Andover Luxury Homes For Sale (LAER Realty Partners) almost 5 years ago

Which is why I recommend agents pick a niche and dominate it. Much easier to be the expert if you are not trying to be all things to all people in a very large market...

Posted by Tim Bradley, Commercial Real Estate Expert in Jackson Hole, WY (Contour Investment Properties) almost 5 years ago

What a useful tool your blog will be for new agents-- all excellent questions for helping newbies identify a market. Well done.

Posted by Ralph Gorgoglione, Hawaii and California Real Estate (800) 591-6121 (Maui Life Homes / Metro Life Homes) almost 5 years ago

Bryant, this is an EXCELLENT post and one that I am going to work on right away! I know my market pretty darn good I think, but I still have a lot of room for improvement after reading your post, THANK YOU!

Posted by Mitch Muller - Charlotte NC Real Estate, Certified Residential Specialist (ProStead Realty Charlotte, NC CRS CDPE mitch@prostead.com) almost 5 years ago

Really solid basics!  Love it.  Kristine :)

Posted by Kim & Kristine Halverson, Realtors (www.LiveWorkSiliconBeach.com, Santa Monica Real Estate :) ) almost 5 years ago

#14 and #15, a double shot of spam! LOL

Thank you, thank you Bryant, so much! I just posted this question on Facebook this afternoon to my agent list: "To be a 'specialist' in a certain city (not neighborhood), what types of information do people expect you to know?" 

I am becoming a buyer's agent very soon, and while I did receive a few replies, your list is very solid and some of those things were not mentioned. This will be very helpful to get started. I should have known Active Rain was the place to come.

Posted by Lynda White, Admin. Mgr., Keller Williams Realty (Bluegrass Homes & Farms Realty, Agent Know How) almost 5 years ago

Great post!

Posted by Kelly Taylor (Keller Williams) almost 5 years ago

This is an excellent post.  Besides sales data, a knowledgeable realtor needs to know everything they can about the neighborhoods including the price ranges, property tax rate, school zones, HOA fees, and amenities.  You want to be the neighborhood expert - and that is what buyers and sellers are looking for when interviewing agents.

Posted by Rosie Moore (Serving Sugar Land, Richmond, Rosenberg, Missouri City) almost 5 years ago

Byrant this is the type of  information consumer seek, and we should have the answers if we want to be known as market experts.

Posted by Jennifer Fivelsdal, Mid Hudson Valley real estate connection ( JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571) almost 5 years ago

Bryant, this is an EXCELLENT post! Very well thought out and a lot of attention to detail.

Posted by Lisa Friedman, 28 Years of Real Estate Experience! (Great American Dream Realty) almost 5 years ago

A great post and very insightful, especially for those who maybe unsure of their real estate market or areas'demographics.

Posted by Kimo Jarrett, Pro Lifestyle Solutions (WikiWiki Realty) almost 5 years ago

I know the answers to all those questions except for the age of the buyers. I'm asked in public a lot how the market is doing and I can tell them. Knowing the market is part of our business. Great post Bryant!

Posted by Jackie Connelly-Fornuff, "Moving at The Speed of YOU!" (Douglas Elliman Real Estate in Babylon NY) almost 5 years ago
Bryant. Thank you for the inspiration. I look up the Mls daily so that I know about new listings and pending sales.
Posted by Gita Bantwal, REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel (RE/MAX Centre Realtors) almost 5 years ago

To hold an intelligent conversation about an important subject as buying or selling is expected...good post

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) almost 5 years ago

And you know, BB, how disappointing it can be when you have all of that information on the top of your brain and the client doesn't give a rat's about it. They pick you because you were standing in front of them or because you answered the phone. I think we'd like to believe our clients are a lot more discerning than they actually are.

Posted by Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents, Put 40 years of experience to work for you (Lyon Real Estate) almost 5 years ago

In my opinion this is the most valuable service we provide. Honest assessment of the market, a good CMA before they make an offer, should they rent a while or buy now, is it the right time to list based on their needs and the market. All questions most consumers can not answer. We as an industry often tend to just cheerlead the market, when at times we should be offering a more cautious approach.

Posted by Chris Miller Nevada Land with Water Rights, Land with Water Rights For Sale (Vegas Grand Realty and Property Management) almost 5 years ago

I've always said the most important things we bring to the table is our knowledge of the marketplace and out negotiating skills. I see too many agents who behave as if they are basically door-openers. Nothing substitutes for true preparation and knowledge and the ability to impart that knowledge in a way people find easily understandable to make important decisions.

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (RE/MAX Executive | Charlotte, NC) almost 5 years ago

Bryant-there is no substitute for market knowledge, for sure. And market knowledge can't be faked.  Your questions are important to understanding what I'd call MACRO market knowledge-you can learn them from behind your desk.  Market knowledge also means MICRO knowledge which means the agent knows what the neighborhood and the homes look and sound like.  The agent with market knowledge has been in those neighborhoods either previewing, showing or listing homes on that street or streets in the same tract.  It's deeper than the market stats or what can be learned from behind your desk.  

Posted by Lloyd Binen, Silicon Valley Realtor since 1976; 408-373-4411 (Certified Realty Services) almost 5 years ago

That's very good stuff, Bryant ... very helpful.  I wonder how many follow it though?  95% of the local Real Estate websites in my area say the Real Estate Agent specializes in every city in South Orange County.  Rarely do I see one that says they actually specialize in a single city.

Posted by Raymond Denton, Shady Canyon Homes (Wholesale Capital Corporation) almost 5 years ago

So true. Our Board puts out weekly stats and it's the first thing I check Monday morning!  Keep up the good work.

Posted by Dee Toohey, Broker, ABR, AHWD, CIPS, FMS, ePro (Innovative Realty Solutions Group) almost 5 years ago

Bryant,

What a great post, thanks for sharing!

Posted by Lillie Painia, ABR, NHC, TAHS (Lillie L. Painia, Tri-R Realty Group) almost 5 years ago

Hi guys. Thanks for stopping by. I hope this article helps someone in their business.

Posted by Bryant Tutas, Selling Florida one home at a time (Tutas Towne Realty, Inc and Garden Views Realty, LLC) almost 5 years ago

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