Once you have chosen the category of real estate you want to become an expert at, your next step is to focus on the area where the property will be located. In other words, you want to become an expert on whatever market you choose.
But first, it pays to pick your market. Here are some of the trends you want to look for in a “hot” market:
1. You look for an area of strong demographic growth 2. You look for a strong, growing, and diverse economy 3. You look for an area of growing retirement population 4. You look for new and substantial infrastructure changes 5. You only move into undervalued markets 6. You always acquire a property with strong potential for appreciation 7. You look for tightening vacancy trends, if you’re focusing on multi-family properties
Now, what are the telltale sign of a “hot” market?
The good news is that most of the information can be readily found in newspapers, magazines and journals. It pays to review the local newspapers, because normally this type of information makes people within the community very proud. It draws a lot of attention.
For instance, I am sure you’ve seen headlines and article quotes like:
• DOT plans major infrastructure for state… • Wal-Mart plans to build second store… • Influx of Baby Boomer Retirees expected to Increase… • And so on…
Now you don’t have to commission consultants or research studies to find this information. It pays to keep your ear to the ground and slowly but surely build up a repository of supporting data associated with the area that will reaffirm your commitment to focus on it.
One of the tricks I have learned is to contact the real estate editors of the local papers and take them to lunch. Get their perspective and insight, ask them the kind of questions you always wanted to know. You’ll be surprised how willing they are to share what they have learned. Most of them have been covering the market for years.
As you start to appreciate the market and understand its nuances and characteristics, the second thing you should be doing is digging into the local building and zoning codebooks and determine the zoning which allows for the type of property you have in mind.
You’ll probably find that more than one type of zoning will allow the type of property you have in mind, which is a really good thing. For instance, you can build a house in a single family zoning but you can always build a house in multi-family zoning. Or you can build a low-density apartment building in medium-density zoning and further on up the chain.
So when you are driving around and you see a low density apartment building, don’t assume that the zoning is limited to that type of building—you may pleasantly surprised it might allow a high-rise office building.
This is why it is essential that you become an expert in a specific market, there are opportunities abound if you understand the market demographics and such as well as the building and zoning codebooks.
Specializing in commercial and investment real estate, Tony Seruga, Yolanda Seruga and Yolanda Bishop are always searching for new and profitable commercial properties across the U.S. Visit http://www.maverickrei.com for more great information.
