Data 101: What conclusions can we draw from local real estate market data?
Posted on February 7, 2018 by Dr. Reid Cummings
What insight can real estate data provide? Real estate market sales data include many variables. To understand the underlying factors affecting current market conditions, real estate practitioners should consider, at a minimum, the number of units sold, median and average prices, how buyers are funding their real estate acquisitions, and the general direction of pricing. Understanding the implications of historical real estate data is also critically important. Specific sales history most often serves as technical support and rational justification for setting list prices. Additionally, it is essential that real estate professionals understand how markets are performing, particularly with respect to different property types and sub-markets within the regional market area.
Who can use this data and how? Understanding how real estate markets are performing is equally important for business owners and non-profits, as well as government leaders. Decisions contemplating hiring new workers, expanding inventories, opening new locations, or imposing new regulations, are all best informed with a clear understanding about how real estate markets are performing.
Current Mobile-Baldwin metropolitan statistical area economic data indicate that the real estate business accounts for 11.03% of the total gross regional product—the market value of all goods and services produced in a region. How significant is that? The next five highest industry segments include wholesale trade at 9.63%, iron and steel manufacturing at 5.97%, chemical manufacturing at 5.68%, hospitals at 4.83%, and shipbuilding at 4.79%.