Scrutinize national housing trends all you want, but influences in your local market are really what determine whether home values rise or fall, NAR Chief Economist David Lereah says in his latest book All Real Estate is Local (Currency/Doubleday, 2007). He delves into an array of factors that can impact local markets — from success of sports teams to what Oprah says about the city — and provides lists and rankings of metro areas that can help you evaluate an area’s DNA. Buy This Book
FROM THE BOOK: 5 INDICATORS OF A HEALTHY LOCAL MARKET
The key to finding a good real estate investment is to figure out what’s affecting supply and demand. But the factors aren’t always as obvious as you might think, Lereah says in his book.
1. Youth drive. A community that has a low average age for the population, such as a median age of 35, is a likely indicator of growth. After all, a younger population is more likely to have children, experience more demand for housing (trade-up buying), and an overall increase in the population, when compared to an older community.
2. Shopping choices. Plans for a new mall or supermarket can greatly increase the draw to certain neighborhoods. In turn, stores or businesses that are closing may be indicative of a sagging market. Gather information by ZIP code of new business start-ups at the U.S. Census Bureau’s Zip Code Business Patterns. Continue reading »