How to analyze the real estate market?

How to do a market research in real estate?

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Before embarking blindly into a real estate investment, it is important to do a market research. A market study is to collect and know information on the ground to get an idea of the price per m², the rents practiced, the demand of the sector and to ensure that we buy at the right price.

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Discover the market with LeBonCoin

If you start your market research, it is because you have identified your geographic area of search. Personally, I use Le Bon Coin to do the analyses. I find the site well provided and representative of the market visible. I go to other sites only when I can’t see a sufficient amount of information. It’s very rare.

Here you can read my article on the choice of location.

Price per m² and Surface

Your selected geographic area, you will be able to advance through the different filters of the site to refine your search. If your number of ads displayed is too thin, it’s because you’ve filtered too much, or your search is very specific. Depending on the case, it will be necessary to remove some filters to see more ads. It’s very easy, the site is intuitive.

The purpose is to list the area, price and condition of the property. We will quickly deduct the price per m². This information is very important and closely linked. The price will depend directly on the area and condition. The status will indicate the importance of the work. The surface will indicate the size of the project and its potential.

We come to an array of the form below. I have expanded the basic information with the type of accommodation, comments, neighborhood, seller etc… You can add what you like.

If you wish, I give you here for free the frame of the table in Excel format.

You will only have to complete it.

Each line represents an ad. On the first line, you will complete the condition of the property, its surface area and finally its price. In the last column, the calculation will be done automatically to give you the price per m² of the property.

Above the table, you have a summary of the prices per m² with the average price of the geographical area you selected, the mini price and the maximum price. This makes it possible to assess the position of the property according to the market.

Comparison of goods

Attention, an important point, compare what is comparable: Studio vs studio and not a T3. Put new goods on one side and old goods on the other. That is why there is a market called “new” and a market called “the old”. The value is not the same.

The bargains

This first information in your pocket, you can easily observe the discrepancies between properties, between geographical areas, neighborhoods, cities, up to the city center. You can apply this method for a house, apartment, report building, etc…

Feel free to use Excel and abuse it to make tables and analyses in every way. Spreadsheet software will be very good partners.

If you wish, I give you here for free the frame of the table in Excel format.

You will only have to complete it.

And the rents?

The method is exactly the same to determine the rents for the region you have selected. However, it will have to be a little more rigorous. Additional elements will need to be incorporated into the analysis: the rental area and the loads. The number of rooms is important.

The table takes a new form, as below. You can enter the charges. The price is calculated automatically, with or without the charges.

I give you here free of charge the frame of this second table in Excel format.

Like the 1st, you will no longer have than to complete it.

And now?

In some geographical areas you may have fewer offers. You will then have to do your market research at several intervals of time, to gather the information, and expand the sector a little.

Now it is up to you to do market research in your area and analyze the price per m² for the geographical area you are interested in.

Investors who rapidly develop their wealth do market research.

It’s up to you to act

PS: Next step: the broker and the loan.

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