by Theresa Bradley-Banta
If you’re thinking about buying multifamily real estate or investing in apartment buildings, this post is for you. It’s also a great resource for the seasoned real estate investor. It is full of tips and free resources to assist you in studying real estate markets and it will help you stay on top of the latest apartment investing industry news.
Free Apartment Market Research Reports
There are some good resources online for free local apartment market data. Multifamily lenders such as Red Capital Group offer free research reports and commercial real estate valuation firms such as Integra Realty Resources also have free reports on local and national apartment markets (download the IRR Viewpoint). The IRR Viewpoint is a great report. You can also go back in time by downloading their earlier issues—a good tool for viewing the historical data of a market.
These reports may be free, but they are full of valuable information.
All of these reports include information on cap rates; vacancy rates; employment; new construction and apartment unit inventory; housing and demographics; rents and capital markets (and more).
The Grass Isn’t Always Greener
Keep the following in the mind:
Many real estate brokers, property sellers and commercial advisory firms often base their data on profomas rather than on real, current data. They may present an optimistic view of their markets and properties. So verify your information from multiple sources.
It’s worth checking out LoopNet while doing your research. This is the biggest online resource for multifamily and apartment building listings—it’s similar to the MLS for single-family properties. But, again, most of the info is inflated as it is coming from the listing brokers or the property owners.
There are many ways to use online commercial listing services like LoopNet to your advantage—especially if you are a new investor looking to buy multifamily properties or apartment buildings. Read: Using Apartment Building and Multifamily Property Listing Services to Your Advantage.
I’m not saying do not hire a local commercial real estate broker. I work with several excellent brokers. But as an entrepreneur and real estate investor you need to lead your team. In order to do that you need to know and study your business.
Which leads me to my next tip:
Free Apartment Industry and Commercial Real Estate Investing Magazines
Before buying your first property, educate yourself on buying apartment buildings. I read everything I can on multifamily investing.
The following apartment industry magazines are free and can be delivered to your door or read online.
Apartment Finance Today is an excellent magazine. This publication will keep you current on the financial markets. Multi-housing News is a magazine that covers markets, trends, finance, credit and other areas of interest to multifamily investors. Multifamily Executive Magazine has news and business strategies for apartment owners, managers, and developers.
For insight into the commercial real estate industry read CIRE Magazine, the magazine of The CCIM Institute. Another must read! (Note: Free online, paid subscription when delivered to your door.)
You’ll also want to read my book Invest In Apartment Buildings Profit Without The Pitfalls. It’s available at Amazon and on most e-readers (click here to find a link to your specific e-reader).
Study Your Local Real Estate Investing Markets
You’ve heard the line “location, location, location”—the three most important factors in buying real estate.
Location holds the key when you’re talking about real estate value. You can buy a cheap property in a dead market—and it’s still a dead market. It doesn’t matter how cheap the property was, you did not make a good investment if you buy a property in a poor location.
The “millionaire maker” multifamily, or apartment, markets are those where jobs are coming to the area, the oversupply is used up, the rents are starting to increase and the market is beginning to appreciate.
Some Great Questions to Ask About Real Estate Markets (and the resources to find the answers)
Do you know what the job growth and employment outlook are for your target area? How about apartment demand? Is the oversupply used up? Are rents on the increase? Do you know what the average vacancy rates are for your market?
Researching a Rental Market
Craig’s List, Zillow and Rent.com will give you an idea for supply and demand for a particular area. You can research rental rates, volume of listings and competition for a particular submarket. Look for concessions such as free rent, free utilities, no deposits required, etc. If you find a lot of concessions they are having trouble filling vacancies.
For research at the submarket level download A Checklist for Researching Real Estate Markets. It includes 20 links where you can find the information you’re looking for!
A word of caution on real estate “market research.” It is critical to drill down to submarkets when doing your research.
Visit our Multifamily Investing Resources Page at this link:
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- How (and Why!) You Should Track the Crazy Multifamily Real Estate Market - February 1, 2019