For any business, you need market research or analysis to compete better.
Market research simply gathers information from people to know the feasibility of a new product or service. With reliable market research, one can make viable decisions and take the right steps towards achieving their business goals.
Our main focus here is the real estate market research which has helped many property investors succeed. It determines the property investment value based on comparable properties in the same geographical area. Note that the comparable properties must have been listed for sale or sold within three to six months. Likewise, they should be at least 1.6 km away from the investment property.
Thus, good real estate market research can help prospective investors choose properties capable of yielding a profit for them down the line. Even when there is a declining economy and fluctuating stock market, you will be able to make appropriate decisions on any real estate deal. Usually, you will need to partner with a firm to get correct real estate data. Here are some true values of conducting real estate market research:
1. It Helps Define Search Area
The location of a property is an important factor in real estate. Its neighborhood and accompanying resources such as schools, entertainment venues, shops, recreational offerings, and more determine property desirability and price. Although neighborhoods aren’t static entities, some economic factors combine to affect property value.
Hence, you need to do prior market research to establish the time and areas of potential profitable investments. For instance, the research could point to a specific area where people demand rental properties. This can help you reap worthwhile returns.
2. It Helps Identify Demographic and Economic Trends
In like manner, the changing cultural norms impact real estate prices, availability, and investment potential. Demographics give real information on potential buyers’ age, income, and regional preferences. It can also tell the percentage of retiree buyers and those who might buy a second home. These are known due to proper market research.
Furthermore, real estate market research provides information on the interest rates and government policies of a geographical area that affects the price and demand of real estate. Tax incentives, deductions, and subsidies can either encourage or discourage demand for real estate.
3. It Helps Verify a Profitable Price Point
The essence of defining search areas and identifying economic trends is to make a profit off your real estate. Through market analysis, you can verify the price at which a property will be profitable. It will help you compare recently sold properties and their current listings to buy at a fair price.
Similarly, you can know when to sell a property to make a profit and when to hold on to it for better income.
4. It Helps You Forecast
You can also tell the future of an asset in a particular location. Real estate market research can give an insight on when to invest in an area. For instance, it can point out areas that will develop in the next few months or years, triggering high demand for rental properties. It can also help you to plan on acquiring properties in strategic areas.
Additionally, you can determine if the real estate will appreciate or depreciate to save you from a poor investment through this market research.
5. It Helps with Correct Real Estate Data
Good market research will produce accurate real estate data. And it’s preferable to conduct real estate market research with Radix, a reliable partner for efficiency.
Radix is an online cloud-based market research and analytics platform that helps users make sense of ambiguous data to increase opportunities for data-driven decisions. This great platform helps eliminate manual effort and human error. Their proprietary technology gets information directly from assets by integrating it with their property management software. This is why they deliver accurate real estate data.
Conclusion
Succeeding as a real estate investor isn’t an easy task. You need the right knowledge and information to make a profitable investment. Real estate market research is a significant way to ensure that you take the right step in your property investment journey. However, you should partner with a market research company like Radix to get accurate real estate data. They have reliable research tools and in-house experts to provide error-free data.