An obvious big "gotcha" is an unexpectedly long time before a buyer comes along, taking a huge chunk from profit potential. Initial asking price is of course a major controlling factor. I'm looking for some techniques that have been used successfully to minimize the likelihood of this happening. Currently, I am using sources like Zillow to simply count listings, sales and rents over various time periods (e.g. 2 months). The idea here is to get a handle on supply and demand in the target area over the past x months. Any input would be much appreciated. I tend to work top-down. I don't won't to spend time in an area finding that great buy that won't move because of economic or other factors. Too bad we don't have a resource that provides a macro economic comparison or ranking by zip code on such things as house sale turn-over, prices, trends, job growth, population growth and inventory levels for things like lots, new homes, etc.
This sounds like it might have some of what you're looking for(not sure what your area is, I used mine): http://www.trulia.com/real_estate/Corvallis-Oregon/
It also might be worth your time to get in touch with a local real estate agent. My office sends out numbers every month about listings in various price ranges, their comparison to the month prior and 1 year prior, average time on market, etc. They'll be in a better position to give you specifics for inventory for your area.
Hope that helps some,
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