For some real estate investing just got a lot more complicated. With NAR busted for inaccurate housing statistics who should investors trust?
The National Association of Realtors may be doing a good job of down playing the fact that they were caught out for incorrectly reporting existing home sales figures for the last 4 years but it could be a much bigger deal than they are letting on for those who have based their investment choices on NAR’ s data.
The National Association of Realtors just revised housing statistics down by over 14% for the period between 2007 and now. 14% may not sound like a lot but that is close to 1,000,000 fewer sales just in 2010. Plus how can you be sure their facts are right now? To say that this is unimportant just isn’t true. Certainly announcing more robust sales has encouraged more individuals and real estate investing companies to buy homes.
The truth is that investors shouldn’t rely on any data or statistics being 100% accurate. Sadly all statistics can be twisted or interpreted in favor of those releasing them or they can just be based on poor data or faulty calculations. You can’t blindly trust websites for pinpointing local housing demand or checking comps. So what can you do to ensure more profitable real estate investing?
Firstly, know your local or target area intimately well. Stay wired in to know which properties are selling, who is buying them and what factors could be tainting appraisals. Then do your own market research. Run newspaper ads and ask questions through social media. Use hard figures so that you know what people are really willing to pay for rentals or certain homes and to better judge how long it will take to fill or occupy potential real estate investing deals.
Want to play it even safer? Build your database of buyers and prospective tenants first, get a commitment and then make acquisitions.