How to determine current market appreciation.

Question

Hey everyone, my name is Dillon and I am 23 years old looking to buy my first property in the next few months. My plan is to house hack and I am looking to buy a 2-4 unit property. I realize appreciation among many other things plays a big part in how you analyze deals and make an informed decision about a property. To do that, how does one calculate current market appreciation in your local market? Are there websites or ways one can determine something like that? Similarly, how do you determine if a property you are considering won't appreciate?

As a new investor, I am looking forward to learning and growing along side you all.

Gregory Acs · Answer

Appreciation is definitely worth considering, but I'd be careful about relying on it when analyzing a deal. I like to assume little to no appreciation and make sure the property still makes sense based on today's cash flow, expenses, and financing. If appreciation happens, that's a bonus rather than something the investment depends on.

To understand a market, I'd look at recent comparable sales, local inventory trends, employment growth, and population changes rather than trying to predict future appreciation. If you'd like to walk through how to analyze a potential house hack or compare financing options for a 2-4 unit property, I'd be happy to help.

Aaron Breckenridge · Answer

Probably best to speak to an agent that knows that market. Appreciation has tapered off over the last few years and months in many markets, so you’ll really want up to date info.

We do track general statistics for a lot of markets at https://www.biggerpockets.com/markets but it’s very broad strokes and it’s only as good as public data out there.