Micro-Markets, The Key To Real Estate

As the housing market makes it's adjustment from the dark depths of the "bottom," we'll have to be smart about interpreting what this means for "our" market.  We're starting to see glimmers of hope in real estate.  Banks are starting to lend again and consumers are starting to get back into the market, but the important thing to understand is that blanket statements, about the "health" of the real estate market, are NOT going to give you an accurate picture of 'your' micro-market.  These broad brush stroke statements are an injustice in helping you understand your home, your market and what you need to do. 

As the real estate market begins its climb there will be imbalances within all local markets.  These imbalances are created by micro-markets within a particular area.  I also like to refer to these as 'neighborhood-markets' and the data for these areas will be a bit harder to locate.  Information on micro-markets won't pop up on the evening news, they won't be mentioned in the national media and they won't appear in your local paper.  These markets will be the pockets within your county, city and neighborhoods.  You'll see a level of activity in one area that won't be mirrored in other areas.  You'll see homes selling on one street and nothing on its neighboring avenue.

To give you an example, over the past year I've seen a tremendous amount of home sales in my local town.  Sadly the majority of activity has been isolated to only a five block radius.  Overall the statistics for home sales has not been overly positive for my town, but if we were to look at this particular location, the story would read much differently.  In fact the statistics, for this area, would be reminiscent of the "boom years."  There's certainly micro-markets that are within my town, the real question is what does this mean?

The answer is simple, you MUST look deep into the statistics of your "area."  That does not mean simply looking at the statistics for your town, but rather your particular street.  Real estate has always been about LOCATION and as we come out of this housing recession, understanding your micro-market will be the most important lesson you could learn.  Understand your micro-market and you'll have the confidence to make the correct decision when it comes to buying or selling real estate.