It is aptly said that Research is a formalized curiosity. Research aims to see what everyone else has seen but to think what no one else has thought. According to Grand View Research, the global real estate market was worth $3.69 trillion in 2021 and is expected to grow at a compound annual growth rate (CAGR) of 5.2% from 2022 to 2030.

The rising population and increasing house demand is bound to boost real estate sales in the United States. Commercial Real Estate Market Research or Comparative Market Analysis is a formidable method to analyze the current market trends of the property an individual is about to buy or sell. 

The article helps to understand what Real Estate research is, how to start Real Estate Research and the significance of Local Real Estate Market Research.

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What Is Real Estate Research?

Market Research is a preliminary step every investor should adopt in their investment strategy. Real Estate Market Research is an inevitable step for every real estate investor before investing. 

So, why is real estate research essential? Real estate research provides a clearer picture before buying and selling any property. Performing comprehensive market research helps an investor in the following ways:

• Understand the market, demographic, and economic trends
• Help to define the Search Area
• Verify a profitable price point
• Knowledge of chargeable rent prices
• Choosing proper investments

Real Estate Market Analysis has different arenas. For example, an equity research team in major investment organizations analyzes market trends and valuable company data to evaluate publicly traded companies. 

Real estate researchers from Linneman Associates, Torto Wheaton, and Rosen Consulting Group analyze the macro and micro events influencing the real estate industry. Organizations like REIS provide information on market rent, building permit, vacancy, and other comprehensive details. 

A junior real estate researcher analyzes market trends, performs surveys, compiles data, and presents real estate research papers.

How To Start Real Estate Research?

Real estate research involves positioning your analysis around the four aspects: market trends, demand, supply, and environment. The basic steps to start a real estate research are as follows:

1. Study The Global Market Trends.

The first step in real estate research is to analyze the market trends, volume, and evolution. The following questions help to gain a better understanding of the market:

• What are the recent housing market trends?
• Who are my potential suppliers? What are the terms and conditions they provide for sale?
• Where does the market stand in a few years?

2. Evaluate The Customer's Potential Through A Survey.

The next step is to study the market demand. Examine the potential customers and the possibility of capitalizing on the demand and expanding the business. Here are a few questions to analyze the consumer market:

• How many customers are there in the market?
• Who are the real estate customers and their locations?
• What are the possible factors influencing the buyer's decision?
• What is the customer consumption rate?

3. Examine The Competitor's Strategy.

Conducting competitor analysis helps to understand their strategy and envision future products.  The questions that can offer some insight are:

• Who are the competitors in the market?
• Which companies have the most significant market shares?
• What is their strategy to gain business?

4. Conduct An Environmental Analysis If The Project Is Feasible.

Conducting an environmental analysis is an essential step in market research. The following environmental factors influence real estate research:

• Community and Commercial Trends
• Public Utilities and Services
• Technological Advancements
• Regulations

5. Perform A Survey And Gather Data.

Conducting a survey provides better insight into local pricing, trends, and potential strategies. However, do ensure that the results are valid and unbiased. 

6. Analyze The Data

Data Analysis involves comprehensively understanding data patterns and generating reports using different tools.

How To Research The Local Real Estate Market?

Before market research, defining or locating the market an investor will buy or sell is crucial. Defining the market involves analyzing the type of products and services offered, evaluating the customers, companies, and administration, and outlining the geographic area.

Listed below are some crucial steps to research the local real estate market:

1. Define a target region or neighborhood.
2. Evaluate your competitors.
3. Analyze the neighborhood
4. Understand the physical elements of the property.
5. Evaluate the performance of the neighborhood.

Conclusion

The real estate market is wavering, given the rising costs and the changing financial and socio-economic trends influencing the market. The Great Recession, turbulent pandemic times, and recent housing affordability crisis have further created ripples at the shore.

In the face of impending challenges, commercial real estate market research provides insight into the market's evolution and future to make risk-averse choices. Our team at Tirios helps you to invest in real estate after conducting the proper market research to ensure superior returns without any unnecessary hassle. Begin investing in real estate without buying property with as little as $1000!

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