Does biggerpockets affect the real estate market?

18 Replies

I was pondering this the other day and I looked through the forums and didn't find anything on this. Does biggerpockets affect real estate prices? Follow my logic here. Biggerpockets has hundereds of thousands of users and growing right? Well doesn't this access to information cause more people to be interested in real estate investing as opposed to other investing? 

Not saying its a bad thing but is there any way the proliferation of biggerpockets has had a direct affect on markets? People can more easily invest from a distance, people can more easily collaborate on deals and information can be more easily disseminated to regular people.

Does this make any sense?

Begin discussion.

@Joseph Weisenbloom Very interesting question... I know BP just broke 300K members and is constantly rising, as well as, all the unique visitors I would assume the exposure on this site is huge.. I know there are many foreign members in BP which means the potential market is over 7 BILLION people... Speaking of the U.S. alone  is something like 320 million... So speaking of maybe 500K involved with community, I think we hardly scratch the surface...

  I'm sure there are some markets that are highly populated with BP members, and might have some impact.. But we live in a pretty big world..

I must agree with @Nick Britton. To add to his sound reasoning based on population sizes, we must consider the percentage of persons who read but don't act (or don't act much). I suspect that more than 50% of BP members are interested, yes, but do not take significant enough action in their markets to alter the standard market forces already at play. Afterall, I also am a member of Motley Fool, and I'm sure their impact on the NYSE is minimal.

I think it does! Biggerpockets is where beginners find the hot markets. Word gets around and next thing you know everyone is heading to those markets. Demand gets higher and inventory decreases which equals pricing to go up. It has crossed my mind once or twice that perhaps I should stop talking to people about the markets I invest in. When I do they go out there and buy the houses I want. :). But it's all good. That good Karma for helping others will make the real estate gods be nice to me. I'm still waiting for that good Karma though.

This has to make the top 10 list of best questions on BP, imho, at least since I've been a member. Which is about two years now. <thumbs up>

Kudos,

Mary

I agree with @Nick Britton going by the numbers, I do not think BiggerPockets affects the market accept maybe in in areas highly populated with BP members.... for now at least but by the way BP is growing it will soon enough have a major impact on markets.... That's what I think, but we will see, huh?

In physics, it's known as the observer effect. The act of observing something causes it to change. It's like checking the tire pressure on a car, in order to check the pressure you must let out a little bit of the air so by checking the pressure you're actually changing the pressure. The same could be said of real estate as well. However overall this should be a net positive effect because the more people you have participating in a market the more liquid that market becomes thus making it a more efficient market.

@Brian Dear Love your scientific angle on this topic. At the end of the day humanity is just a set of variables at work.

@Mary B. I always knew I was a genius ;)

If Cramer can influence the stock market through his show why cant biggerpoeckets affect the real estate market? 300k people may not be very powerful but 300k people with money could have an affect.

@Joseph Weisenbloom  some bp effect on markets I think there is some.. for instance I never thought much of Cleveland as a buy and hold market.. but James wise is a frequent welcome wagon poster on BP and I use's BP to its fullest extent so I think there are folks that maybe would never have considered Cleveland and that are now invested there.

I don't think 300k people are active at anyone time on bp or a even a fraction of them. when I happen to open a post that may be 3 to 5 years old I scroll through and virtually none of the folks posting are familiar or I have seen posting since those days.. so I think you get a lot of folks that come and go.  

There is no question to the general thought that BP and internet marketing creates and stimulates activities in certain quote un quote cash flow markets... 

YOu see very few folks advertising to sell west coast properties on BP and the reason is they don't need to.. they can sell them on MLS or word of mouth without using a site like this. the reason there is a organic demand for those properties.. where in cities were you see them marketed here on BP or all over the internet to get out of state investors is simply because they do not have enough local investors to buy their assets and there is no questions that all of this out of state and country investing has propped up many markets. Is it a false market in some cases probably .. if the out of state investor goes off the feed the pressure on those assets would diminish to the local demand which in many areas simply is not very much.

the other thing to keep in mind is markets are separated.. you have markets that are being sought after for cash flow but not much flip and fix retail goes on there and if it does its usually locals who don't need a BP presence to resell or talk about their markets.

But for the cash flow markets this is the provence of turn key companies and sellers of lower end assets that create returns ( when they work right) that are greater than were other investors live.. thereby creating a demand

Don't have much to materially add here, but @Jay Hinrichs is right. Not everyone on here contributes or actually invests.  Of the hundreds of thousands of users, about 20% do 80% of the posting and actual transactions I bet.  Still, it's making more people aware of different geographical markets and different niches and strategies to play in!  Awareness is powerful.  Case-Schiller should start surveying BP factor at closings!

All I know is while I'm on here interacting it seems like everybody and their brother is in RE.  Then I go out into the world and realize it's not so much. I thank BP for an awesome forum to get my RE geek on!   Cheers! 

We're close to 360k members now and reach well over 1.2 million people per month.  Just because people aren't registered as members on the site doesn't mean that BiggerPockets doesn't affect them or their decision making.

BiggerPockets has reached tens of millions of people since our launch.

I believe our impact is far greater that I even think.

Just throwing that in....

The other thing I would add is that BP is probably more top heavy with newer investors - most of which are only buying a couple houses a year if at all. Those types of investors aren't going to move the needle in terms of pricing.

And my guess is that BP isn't spawning a ton of big time operations to be created either. Those companies would do that organically regardless of whether they're on BP or not.

What I think BP does it create better and more informed investors. Ultimately, if I run into a problem I can't figure out, I can go to BP and get some advice. Or I can watch the forums every few days and pick up tip after tip after tip.

Is that going to affect pricing in my area? Not a chance. Someone like me isn't going to move anything.  But it definitely makes me a better investor and improves my chance for success.

And it allows me to meet/talk with other investors where I get to learn even more and/or just have more fun talking real estate - as for many of us this is a passion too. 

@Joshua Dorkin That post seems like a plug, but for what I'm not sure.....

BP may affect some real estate markets, like Jay said popular markets might get more attention thanks to the information provided here.

Overall though, I doubt it has a significant effect. The vast majority of real estate buyers are NOT investors, and the vast majority of real estate investors are not on BP. While this community is growing, I just don't see it having the oomph to make noticeable movements.

That said, I don't have an effing clue what I'm talking about, I'm literally just guessing.

Thats the red elephant in the room, thats been sitting there for a while. This needs to be asked, frequently. To think that BP does not have an effect on many markets, is just naive. People with 0-2 deals are giving out real estate advice, and people (many who are probably in debt) want to become (and do become) REIs which definitely can inflate prices and perceived demand.

BP has definitely affected Milwaukee. I know of at least 12-15 out of state investors who invest here and since 2012 prices have gone up and the market is much more competitive.

@Joshua Dorkin

For testing purposes, I just searched "how to get started in real estate" on google. The very first link was to one of the BP blog page. Congrats on that! 

Another interesting thing is that while Google may know how many people are interested in RE at any given point in time, you also would be able to get similar data by monitoring blog page views and number of newbies joining BP on any given day. Just makes for interesting stats. Maybe some correlation with home prices and boom/bust cycles? 

The affects are good and bad. 

The good, as a real estate service provider I can better service my clients because I know what they are looking for and I can actually follow the trends and provide a product that investors want. 

The bad, investor come into the market with unrealistic expectations because of what he/she read on BP.  Not to mention higher real estate price as @Dawn Anastasi said. 

I think BP has increased the number of investors out there. People may have seen an infomercial, or read a book, which planted the seed in their head about REI. But next comes action, and that is scary. BP makes it more approachable and realistic by having real people share their experiences and strategies. When you see some other "normal" person who was in a similar situation as you become successful and take action, it shows you that you can do it too.

So while BP has created more investors who might not have taken action without it, I still think that we are the minority in most markets.  Retail buyers still dominate the sales and their purchase habits influence the market more than we do.

I also think BP has helped investors expand their mind to other markets and ways of doing deals.  When I found BP I already had a couple of properties in my home market.  It had never crossed my mind to look at other markets, do commercial lending, or be a full time investor.  If I did not find BP I would have probably bought 1 more property (instead of 26) and would still be working a corporate job.  

The Internet and avalibilty of information has made it easier for the majority of the population to become aware of trends. I think the impact will be less peak/valley market cycles. I don't know if this applies to RE but these days the latest gadget does not stick around that long. 

One thought I have about BP is that although RE is a powerful mechanism to build wealth that it's widespread popularity can make some who should not be In RE try and fail and go two steps backwards. If you are not savvy enough to network and learn about RE without wonderful the BP guide to ... then maybe you are not worthy to take on leverage and upkeep the housing that others rely on. 

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here