Encore is a special, by-invitation-only, real estate professional's group that offers personalized coaching in an environment that provides individual attention to growth and fosters relationships with top-performing agents throughout the Puget Sound region. We focus on accountability, practices that improve business, developing market expertise, presentation skills, referral building, and deep-dive conversations into opportunities for real estate brokers that you won't find anywhere else.
Our members are committed to improving their businesses and providing top notch service to their clients. Does that sound like you? Learn more about Encore and our live monthly group meetings located Lynnwood, WA at the link below and schedule a consultation to find out if we are the right fit for you!
If you want to be viewed as a market expert, you must completely understand your local market. Most of this information is easily accessible from your MLS. Every agent must be able to analyze for their marketplace:
Go into the MLS and find out the total number of sales in your area/s for each of the past three years. This will show you a number of things, including the pace at which the market has sold. Put this information into your binder along with a chart or graph for each year to show the differences. This is the first step in even knowing how much real estate is sold each year. And yes, I want you to pull each and every sold property as you will need this information for some of the other analyses.
Go through the solds and track the days on market number (DOM) for each, then separate by price point. Track the days on market numbers for each price point, tally them up and then find the average DOM number for each price point. You will find that there is a definite trend in DOM numbers based on the price points. This is an excellent exercise for seeing the obvious trends in your market.
This is analysis requires you have to compare the average sale prices in your area from year to year. You can not generalize when it comes to price appreciation. Go into the MLS and do a radius search for one neighborhood, and compare the sales year-to-year to see the obvious changes in the sales prices which will reflect the appreciation rate. You can then apply a factor to this number for each year to find out what the average per year appreciation rate is in each area.
Go into the MLS and find out the total number of listings taken each year, and then compare that to the total sales. You will be able to easily chart these numbers for a very strong visual representation of the true activity level in the market. When you track this yearly you begin to see how predictable the real estate market is. This kind of data helps to provide you with protection against negative media reports, and allows you to assure your clients of the true picture of stability in the market.
You need to analyze your area in terms of economy, recreation, medical, financial, job market, etc. Go to your local Chamber of Commerce and tell them that you want to create a profile for out of town buyers that have never been to your area before. Most Chamber of Commerce have done an excellent job of compiling this kind of information. This information will also come in handy for creating a snapshot document of your area that you can include in your packages with your custom look.
You must know how to calculate the absorption rate in your area. The absorption rate indicates is the analysis of how long the market is taking to "absorb" the housing inventory. For example, if there are 100 homes currently listed on the market for sale and homes in that particular price range are selling at a rate of 10 per month, then the absorption rate would be 10 months (100 homes divided by 10 sales per month at a rate of 10 per month so it would take 10 months to "absorb" the inventory). This is a great way for you to demonstrate what is going on in the market.
Because every home that is built and sold begins with the land, every agent needs to know the cost of land. Agents must have a clear understanding of land sales in their area. You should know the price of farm, waterfront, water view, and single-family housing land.
Every market has opportunities, and often properties which consistently sell in a short number of days on market offer hidden opportunities. If condos consistently sell quickly, that may indicate a great niche market to pursue. By keeping track of the properties that sell most quickly you will see trends and opportunities in the market.
Don't be overwhelmed by this list. All of this research can be done by the average agent, but isn't! Start with just one of these research categories. When you have completed and mastered one, then move to the next. I promise you that if you do keep track of this information you will be a more confident, knowledgeable, and successful agent.