Know Your Market...Now How To!

I posted this in a thread but decided to bring it up to it's own. Whether you are actually the rehabber or you have rehab buyers you are wholesaling to. This is one of the keys that will separate you from the masses. Most 'investors' are NOT doing this. Most don't know to do this. Most buyers will say "I want properties in $XXX-XXX range that I can sell for $XXX-XXX and clear a XXX profit." pretty standard right?!? Well I blew a few minds last year, I still have people approach me and tell me I want to buy here $XX, sell here $XX, clear $XX and turn it on 90 days. lol Which is fine, but he MAY be 'actually' holding it longer than anticipated if his only method of filtering is based off buy price. When you show them what I'm about to show you (some of you may be already doing it, some not) to your buyer you will become one of his prized 'secret weapons' lol People will stand a better chance of getting his wifes # than yours! Be valuable to you customers/clients! You will earn instant credibility. You don't have to know it "ALL" just know what you're doing!

Here it is:

If B/F/S (buy/fix/sell) is your preferred strategy you HAVE to know what the market it doing, where are you pockets, DOM, etc.
I also am heavily using this strategy. My market is turning as well. Every month on the 1st I do indepth analysis like clockwork. I've been tracking DOM, solds, zips, pockets and seeing a steady decrease in DOM and increase of retail sales. I also run reports by: 30 days solds, method: VA, FHA, Conventional (targeting retail buyers) then filter by neighborhood/community. More than one sold in a specific neighborhood, gets farmed by me with bandit signs! lol

Have an agent send you Sales by Area. Specifically each month 06/01/2012-06/30/2012 for the last 3 months minimum. I use this to get a # of solds per sales area then place them in order from highest to lowest. Focusing on the top clear risers. Ex Area #XX = 40 solds will be #1, Area #XX 32 solds will be #2, etc.

area = zip codes

from this I run for the top risers a Price Range Statistics Report based on that area for 'solds'. If you study it you will see a trend. You will find your pockets. For me tons of investors like the $30-45k pocket to buy. It comes on listed and 5 offers by noon now. But in certain zips the highest # of sales and lowest DOM may actually be properties with ARV of $150,000-159,999 that equate to 18 of the 32 being in that price range and for that pocket an average DOM being 14. But by zip (total area) DOM may be 102. Make sense?
(You can still get ANY spread in ANY price range)

If investors are ONLY in a specific 'niche' they are missing a mass market by not KNOWING their market and what retail buyers are purchasing. By doing this you just decreased you DOM from 102 to 14. Every area has these pockets of price ranges/solds.....find them. Take action!

By tracking solds and DOM they will give you the bottom #, solds will give you the top#. They will tell you where you need to be to and what strategy to use.

That's a good start! Hope this helps.

Remember nothing moves until we do!
God bless,
Jen

link to original thread posted: #6
http://www.deangraziosi.com/real-estate-forums/buying-foreclosures-reos-...