What’s one thing every seasoned real estate developer, broker, investor, builder, and lender will tell you about the real estate game?
Know your market!
Know it like the back of your hand. Know it more than anything. Ok, maybe not that much, but you get the idea.
When we know our market, we’re able to make stronger business decisions, deals become less risky, and we can sift through the clutter much easier. Since all real estate is local, knowing the nitty-gritty details of every block, building, and space makes sense.
But what happens when you’re uprooted from your market and relocate to a different place?
I recently relocated from the good olde midwest to the always-bring-a-coat land of San Francisco–two vastly different real estate markets (and, as I quickly learned, vastly different levels of traffic)! So what is a real estate professional to do when faced with a new place, different market fundamentals, and an appetite to wear down some shoe leather?!
While it can take a long time to feel fully entrenched in a given market, here are a few ways you can rapidly accelerate your knowledge of the real estate game in your new city:
Drive the Area
Take time to drive the area. Turn off the GPS, put the map away, find a great radio station, and set off in a quest to get lost. Look for interesting streets, landmarks, and neighborhoods that stick out. Driving an area with the intention of getting lost gives you a great opportunity to find neighborhoods, streets, and buildings that might have originally been off your radar. You’ll also quickly develop a sense for which areas to focus on further.
Walking/biking – better
Here’s my absolute favorite way to get to know a city. Walk or bike the area! I love doing this more than driving because you get a stronger connection with the subtle little things that makes places work and not work.
Meet up With Fellow Real Estate Professionals
Local real estate professionals are the gate keepers to the knowledge that drives successful neighborhood-specific deals. Reach out to fellow professionals and be inquisitive about your new market. Quick note here: this is a two-way street when someone takes the time to meet and talk shop about the local market–so be ready to add value to the conversation (always appreciated). Ways to meet fellow pros: ask someone out to coffee and/or participate in local real estate organizations.
Engage the BiggerPockets Community
Great story here. I randomly found out that BiggerPockets’ own Brandon Turner was in town for a real estate conference. After a few email exchanges back and forth, we got a happy hour set up. Brandon, being an amazing community-builder and ambassador for BiggerPockets, saw an opportunity to set up an impromptu BiggerPockets meet-up event. We quickly had a great event with fellow BiggerPockets members that was only organized hours beforehand (quick note: follow the BiggerPockets gents on Twitter if you can).
Take-a-way from the event: there’s an engaged BiggerPockets community in every market that’s eager to connect!
Pick specific properties to analyze
The economics of my new Bay-Area market are vastly different than my old St. Louis market. What’s one way to quickly adjust and recenter your new “normal” for economic fundamentals/standards (i.e. rents, acquisition prices, land values, absorption rates, etc.)? Just jump in and start analyzing projects. If you’re into development like I am, start building a pro forma for a vacant parcel down the street. If you acquire existing properties, see if a nearby property with existing cash flow can be improved and what it would take to improve it. The point is to just jump in. Over time the nuances of your new market should arise.
It doesn’t matter if they are residential, commercial, or vacant land–tour properties to see how similar or different they are from properties in your old market. You may notice preferences for specific spaces, amenities, layouts, and styles that aren’t common in your old market.
It’ll take time to fully understand my new market–likely won’t ever get there. But, through the steps above, I’m enormously excited to accelerate my market knowledge. If you find yourself in a new place, take your time but also don’t be shy about wanting to learn and understand how your new market operates. Good luck!
Photo: < davidyuweb