Real estate research might start with a look at the U.S. Census information
about a town. It can include inspections of specific properties, too. There are
many statistical tools and information that can help, but don't forget one of the
easiest and most useful research tools: talking. Let me explain with a true
story.
My wife and I were on vacation, and stopped in Farmington, New Mexico for a few
days. We were about to buy a house for a winter project. The plan was to fix it
up and sell it in the spring for a profit.
Just prior to making an offer, we took a last walk-through. As the owner showed
me around, my wife started to talk to the woman who was renting the home. She
told Ana that half of the outlets in the home didn't work, as well as other
useful information.
This got me thinking, and I went down to the basement for a second look at the
wiring. Not only did the house likely need all new wiring, but I found a garden
hose attached to a natural gas line. The owner shrugged and said, "You can just
cut that off."
To this day, I don't know what that was about, but for these and other reasons,
we didn't buy the house. It helps to talk to anyone you can when looking at a
house or other real estate investment. Neighbors and renters are especially
helpful.
Real Estate Research - Choosing a City
Talking to a lot of people isn't just useful for information on individual
properties. It is also a great way to research a town. I once called the Chamber
of Commerce of Deming, New Mexico. The chairman's casually commented that the
city was using up the water faster than the aquifer was being replenished. They
had no back-up plan. This was enough for us to cross Deming off our list.
If you want to know about a town, use the phone first. Find any excuse to call
anyone from a real estate agent to a random resident. Ask about crime, whether
the local government welcomes new businesses, what the climate is like. Have
houses been sitting for sale for a long time, or do they go fast? What are the
good and bad things about the town?
Before we moved to Tucson, Arizona, part of our real estate research was to call
people in potential towns to see if they owned a snow shovel. If so, we crossed
the town off the list. Two places can both get 45 inches of snow per year, but
in some it stays all winter, and in others it melts before noon. The snow shovel
question told us the truth behind the statistics.
Once you're in a town, a good local bar can be a great place to do your
research. After a beer, patrons will tell you what big employers are about to
move in or out of the town, how fast homes are selling, whether there are gangs,
and much more. Talking to people is a good way to do real estate research, but
verify what you hear. People do sometimes exaggerate.
Steve Gillman has invested real estate for years. To learn more, and to see a photo of a beautiful house he and his wife bought for $17,500, visit http://www.HousesUnderFiftyThousand.com