Get To Know Your Market

Get To Know Your Market
05-27-08
People are investing in real estate all the time. Many fortunes were built with real estate. These empires were able to be built because some one took the time to get to know the market. Not understanding what the real estate market is doing can cause serious problems for the investor.

The first thing to look at are past sales. You want to know what the selling price of each house was. It does not matter the asking price was $200,000. It does matter the house only sold for $160,000. When you see what the houses in the are have sold for then you can get a good understanding of what they are worth. This may not always be what the appraisal says. The selling price is what the market will bear.

You will also want to know how long the homes were on the market before they sold. A house that sold for $175,000 may get you excited. How excited will you be to learn the property was on the market for 2 years before someone bought it. The other houses which sold for $125,000 sold in 4 months. This should help you determine what the market will support.

Researching an area is not hard work. It can be time consuming. It is worth the time to investigate everything you can about a property. This is your money and you want to make sure it will grow. You do not want to lose money on a deal. Without researching the market and the home, you could lose your hard earned cash.

As you get to know the market you will be able to tell which houses are going to sit and which are going to move. A large house in a small senior area will most likely sit for some time. Many older people are looking for single story homes that are smaller. The maintenance and upkeep is cheaper. It is easier to keep clean. The taxes and insurance are cheaper. To find a two story four bedroom home in the middle of two bedroom ranches may be nice. It is not a good investment. The market will not support it. The people who are looking in that area will drive right by.

Another area of interest when assessing a property is square footage. When you start to understand the market you will realize this can make a big difference as to whether the property is a good investment. Just because it is small does not mean it is worth looking at. Determining the square footage of a house is easy. You just measure the livable space of the house. This will be the living room, kitchen, bedrooms, and other areas like family rooms and rec rooms. Bathrooms do not get added. A room that does not have a natural heat source, a natural light source, and walk in access can not be included. This means most rooms in the basement because of a lack of normal size windows. You can include a finished attic that has a staircase and windows. Large homes can sell quickly in a market that caters to families. A home that has a small floor plan would be better suited for an area where senior citizens reside.

There will be properties you run across that seem like a steal. It has everything a dream home could. If it is not in the right market area then it is not a good investment. When you get to know your market, you will know what to buy and what to stay away from.

Mark E. Moebius
Miljonair Homes
Custom home builder St. Louis3
451 St. Albans Rd.
St. Albans, MO 63073
636.300.9000