For those of us who use content marketing as the foundation of lead generation, "expertise" is often the commodity that we are selling. How many home sellers and home buyers are out there trying to find answers to their questions, and how often are we the ones providing the answers? Well, I can tell you from great experience that oftentimes, the answer to their question has something to do with local housing market conditions.
There are many ways to "know the market" when you are a real estate agent and most of us who have seen a few thousand homes or so feel like we have a pretty solid grasp on our local real estate market. But there are some simple hacks that you can prepare monthly to give you insight that will far exceed what any other real estate agent is doing.
Keep A Record Of All Home Sales
The first tip is to keep a record of all home sales in your market. This might be a bit intimidating at first, but I promise it is far easier than you might expect. All you need is a spreadsheet program like Google Sheets or Microsoft Excel. Some of the fields that you might want to track are the ones people most often ask about (location, bedrooms, bathrooms, square footage, acreage, pool, frontage, etc.).
If you take the time each month to download home sales to your database, you can create reports that update themselves over time. I started my spreadsheets back in 2003, so imagine the information that I have that nobody else has? But even if I were to start today, I can download all home sales in my MLS, which means my database would have more than ten years of records (plenty for my needs).
Create A Visual Representation Of Key Data
They say a picture is worth 1,000 words, and they are not wrong. Having good data is critical to understanding the housing market, but creating a visual representation of that data is the key to being able to understand and explain housing market conditions better than your competition. While this is not something that will happen for you overnight, it certainly is something that you can master if you commit a little time to the effort.
I started setting up my market reports and spreadsheets more than 15 years ago, and over that time I have developed hundreds of graphs that visually depict an element of current market conditions. This is great for content marketing because I can publish a graph and an explanation of what it means. If I publish on a regular schedule, I can develop a following that will ultimately result in sales from a customer base that truly believes in my expertise, even before we meet. Can you imagine working with people who like and trust you before you even meet?
Understand The Most Critical Pieces Of Market Intelligence
Of all the several hundred graphs and charts that I have on hand, I believe the most important ones directly relate to the supply and demand of homes for sale. You see, nothing impacts current value change more than the relationship between the supply of homes for sale and the current rate of demand, so my best intel comes from graphs that relate this information to myself and my readers. Here are a few examples:
Year Over Year Home Sales
One way to have a clear understanding of the demand for homes in your area is to monitor year over year home sales. This graph is simple but highly informative.
In the graph above, each month is compared to the same month the year prior. For example, September 2019 is compared to September 2018, March 2015 is compared to March 2014, etc. The change between months is plotted as a percentage (green if positive, red if negative). As you can see above, year over year home sales in September soared 30% higher. Demand right now is good!
Year To Date Home Sales
The year over year report is great, but to get a feel for how things stand, we also need a cumulative impact from sales each month.
In the graph above, we see the total number of homes sold each year from January through September. This is a simple visual, but it also shows your reader something nobody else can tell them ... just how strong the current market is compared to past years. The graph above shows that 2019 is only a handful of home sales behind 2018, making it the fifth strongest year for homes sold going back to 2002.
The Relative Supply Of Homes For Sale
Are you in a seller's market? A buyer's market? Split? How do you know? Believe it or not, tracking all sales and listings in your market area allows you to produce an answer to this each month that far surpasses anything your competition can deliver.
In the chart above, I show the non-seasonal months of supply of homes for sale for each price range in each quadrant of the Tallahassee real estate market. I refer to this as the "relative supply of homes," as the months of supply show current supply at the relative rate of demand. Anything over 6.0 months of supply is a buyers market, anything under 6.0 months of supply is a seller's market. As you can see, Tallahassee is in a strong seller's market (4.1 months of supply), but it is still a buyers market above $450K.
What's so great about this chart is that it shows sellers and buyers how negotiations will fare. Even better, this is a chart that auto-populates in my spreadsheet, meaning all I have do is bring in the new sales and the new listings, and it updates itself each month.
How To Get Started
Before you begin downloading the listings and sales from your MLS, I would first recommend you get comfortable with MS Excel or another spreadsheet program. Go online and take some tutorials. Learn how to graph data and customize those graphs to become marketing pieces so that they convey market information PLUS information on you (branding). Learn how to use pivot tables (confusing at first, easy once you do several of them).
Once you are comfortable with the spreadsheet application that you will use, take some time to determine what fields you want to track. While "the more the merrier" was my first thought, what I have found is that many of my spreadsheets are slow and burdensome, carrying too much data that I will never use. If I could go back to the beginning, I would track far fewer fields from my MLS.
Having learned the application and chosen your desired fields, all you need to do now is download the information from your MLS. It is important to create a recurring task to update your spreadsheets each (month or week). If you do a small bit each week, you'll find yourself learning more about the market than you ever imagined possible.
Good luck and tag me in your articles when you start writing about market reports. I would love to see what you've done and I'm always looking for new ideas and methodologies for tracking the real estate market.
Some Of My Content Marketing With Market Report Visuals
The following links take you to some of the graphs that I used in my content marketing plan in the past six weeks:
- Weekly Housing Report
- Median Home Price Report
- Surrounding Counties Report
- Housing Market Health Report
- Supply Of Homes Report