Chapter 16 Market Analysis

Submarket

A submarket is defined as: "A division of a total market that reflects the preferences of a particular set of buyers and sellers, e.g., fast food restaurants as a submarket of the overall restaurant market." We may have a market that could be defined as all the residential properties in the town or county. Within that total residential market there could be submarkets that consist of: Single-unit Two- to four-unit Multi-unit Old houses New houses Starter homes under $100,000 Mid-range homes between $100,000 and $300,000 Luxury homes in excess of $300,000 Condominiums Apartments Townhouses Suburban houses Rural houses

American Factfinder

American FactFinder is full of great information for appraisers. On one page you can see demographics about Population Ages Household size Family size Housing units Total Rented Vacant Education levels Labor force Median income Median housing price Mortgage information First, go to the www.census.gov website. Then click on "Data" tab at the top center of the page, then click on "Data Tools & Apps", then click on the link that says "American FactFinder." Then type in your city and state and click the "GO" button.

Absorption Trends

An absorption rate is defined as: "Broadly, the rate at which vacant space in a property or group of properties for sale or lease has been or is expected to be successfully sold or leased over a specified period of time." A residential absorption rate may predict that there is a sustainable need for an additional 500 units per year. Or perhaps it may predict a short term need for 200 units now and then 100 more a year after that. If there is a demand for 500 units a year and there are currently 1,000 units for sale, then we are looking at a two-year supply currently on the market. Absorption rate applies to both residential and non-residential properties. For example, a commercial absorption rate may estimate that there is an annual need for one million square feet of office space. An absorption period is defined as "The actual or expected period required from the time a property, group of properties, or commodity is initially offered for lease, purchase, or use by its eventual users until all portions have been sold or stabilized occupancy has been achieved." This is a crucial time frame for developers. If I build 30 new houses, how long will it take until they are all sold? If I build a new apartment building with 60 units, how long will it take before they are all rented? If I build a new office park, how long will it take until all the sites are sold? Developers or entrepreneurs have to lay out many expenses up front for the initial site development and construction. They have to build the buildings, access roads, incur site development costs, and then carry the property including taxes and insurance costs before the first dollar of return comes back from property sales. It makes a big difference to the developer's bottom line if the units will be sold out in two months or two years.

Conversions in Progress

Another potential source of particular housing types is conversions. In many areas there is a trend to convert apartment buildings into condominiums or co-ops, which are then sold as residences. This creates new housing units but also reduces the amount of available rental units. You may also find in some locations there is a trend to convert large single-unit properties into multi-unit apartments. This is the reverse of the trend in the example above. This would create more rental properties while removing single-unit properties from the marketplace. Another recent trend in the commercial arena is creating commercial condominiums from existing properties that previously were renting commercial space. Now the stores or offices are sold instead of rented. Such actions will impact the amount of properties in the marketplace.

Properties Offered For Sale

Another real component of the supply analysis is the amount of properties currently offered for sale. There may be a large amount of existing housing stock, but very little of it is currently on the market. You can't just look at the total number of properties currently existing, under construction, or planned for the near future. That just tells you how many properties possibly could be purchased. You'll never have 100% of the housing stock available for purchase. If there's a demand for 1,000 units, you need to balance that with the number of properties that are available for sale. The number of properties currently on the market varies considerably based on a number of factors. It's impossible to get a precise count. But usually your best measure is a survey of real estate agents and any local multiple listing services (MLS). MLS is not available in every area, but in many areas it is the primary marketing mechanism and will carry the majority of properties currently available for sale. MLS does concentrate on residential properties and you may find few if any commercial listings there. For commercial properties you will have to rely on other sources, such as commercial brokers or internet sites. Virtually all MLS systems today are computerized; and most of them have the capacity for would-be buyers to search for listings on the web. In most cases you can go in and do a search for specific property types and it will produce a list of all available properties for sale in that category.

Unemployment Rates

Back in Chapter 12 we talked about how to find the unemployment rates for your local community. It is another factor that we need to take into account when analyzing housing demand. There may be just so many people in an area, and their average income may be "X" dollars. However, some of them may not be working at all and have zero income. This may be a short-term or long-term situation. Perhaps there have been recent layoffs by some of the major employers in the area. Perhaps this situation is permanent or it may be temporary in duration. Are the unemployment rates in general going up or down? What are the projections for the future? Are good-paying manufacturing or professional jobs going away and being replaced by low-paying, unskilled labor jobs? We stated it previously, but it bears repeating. National or statewide figures may not be indicative of the prevailing conditions in a local market area. An appraiser needs to spend a significant amount of time studying local trends.

Disaggregation

Disaggregation is defined as: "The differentiation of a subject property from other properties on the basis of subclassifications with differing product characteristics." This is the actual process by which we would separate and define some markets. The process of disaggregation must be undertaken carefully if we wish to get logical and meaningful results. No matter how carefully you analyze data, you will produce meaningless results unless you are analyzing the correct data to start with. I know the phrase "garbage in - garbage out" has been overused, but in some cases the phrase has merit. In undertaking this process of disaggregation, it is tempting to try to be too precise and cut things too finely. If you try to define the market according to every characteristic of a property, you may wind up with a market of one or two properties. At that point, disaggregation will not produce a meaningful result. You need to think through all the factors and the characteristics of the properties that are pertinent. Pick the three or four most important factors that you are trying to analyze. Find the most important of the influences on value that would sway a potential buyer in one direction or another. Remember the principle of competition. Identify areas where potential purchasers of that particular type of property would consider buying. You want to identify areas that would be competitive in the minds of the typical purchaser.

Planned Construction - New Building Permits

Existing stock is an important guide but it is also important to try to get a handle on how many units are in the pipeline. In almost all areas of the country today one needs to obtain a building permit prior to starting construction. Once construction starts it may take three to 12 months or more to completion, depending upon the type of structure being built. There may also be unexpected delays in the construction schedule due to weather related problems or financing availability. So the amount of building permits issued provides the best estimate of how many new units will be coming online in the near future. There may be an apparent shortage of housing if you count up just the existing and new stock. Assume a new employer is coming to town and plans on hiring 500 employees. Let's further assume that approximately 400 of them will buy houses in the area. You may do a quick check and determine that there are only 200 houses currently available for sale. That sure looks like an undersupply of housing. However, this influx may have been known for a while and local builders have been gearing up in anticipation. You may discover that, even though few houses have started, there have been 500 new building permits issued in the last three months. That puts a different complexion on the supply situation. The NAHB web site also carries information on building permits issued in all areas of the country; however this information is usually for the previous year, and it does not tell you the number of permits that were issued last week or last month. Of course, the more accurate and immediate source of local information would be to contact the local building department that issues building permits.

Volume of New Construction

How much new construction is currently going on? How many new units have been built in the last one year or five years? How does that compare with the previous five or ten years? Does the trend seem to be increasing or decreasing? This kind of information is also readily available. You may see reports periodically in your local news outlet. Perhaps there is a business section or real estate section that is published weekly which highlights recent developments. New construction starts are tracked by the National Association of Home Builders (NAHB), and statistics are available on their website. Click below to go visit the website. Once you're on their homepage, click on the tab at the top center which says "Housing Data." Then click on "Construction Statistics." This will take you to a new page, with a menu on the left side. Go to the bottom of the menu and click on "State and Local Data". They have a changing array of reports that are updated on a regular schedule. I found an Excel spreadsheet titled "Building Permits: State and Metro Areas" that listed the numbers of building permits issued in states and metro areas throughout the U.S. There was also a forecast of expected housing starts for the coming year. Some of the NAHB information is free to the public and some is only available by subscription. But there is a tremendous amount of free information. You need to check back periodically and poke around. Click Here. Then, of course, you need to add the amount of new construction to the previous total of standing stock to arrive at a current picture. For example, the latest statistics you have on the existing stock of housing might be dated 2017. If you then find that 300 new houses were built in 2018, add that in to get the current total.

Demand Analysis

In applying the appraisal process to residential properties we may research and analyze factors such as: Population trends Income and wage levels Employment types and patterns Unemployment rates Mortgage information Land use patterns Physical factors Local government Some of these factors were covered in earlier chapters in different contexts. We discussed them in general when we were talking about various categories of influences on value.

Market Analysis

Let's begin with some definitions. Once again, we turn to The Dictionary of Real Estate Appraisal, Sixth Edition, published by the Appraisal Institute (2015). Market analysis is defined as: "The study of the supply and demand in a specific area for a specific type of property." A market analysis, in general, studies the market for any particular economic good. We, of course, are interested in the market for real estate. Let's review the definition for real property market that we introduced in Chapter 9. Real property market is defined as: "Buyers and sellers of particular real estate and the transactions that occur among them." Thus, the real property market is not an established market where participants are gathered together in an established place. The participants in the real property market are an amorphous group of entities who come together infrequently in specific situations and then are disbanded.

Macroeconomics

Macroeconomics is defined as: "Study of the economy as an aggregate system, focusing on national/domestic production, national/domestic income, the supply of money, the rate of inflation, the national budget, the balance of trade, and the interrelationships among constituent sectors. " This is a study of the big picture. We are looking through a wide-angle lens at the major factors on a national or regional level that impact real estate in general. These factors tend to impact all properties equally and are applicable across the board to almost all kinds of real estate. They are far removed from an individual property and have less direct impact. Nonetheless, they are important. Whether the country as a whole is in a boom time or a recession reflects on the thinking and the actions of buyers and sellers of all products. If we are in a time of rising inflation, that tends to impact consumer actions. Certainly, the actions of the Federal Reserve Board and other government entities that impact interest rates, and in particular mortgage interest rates, have a direct impact on local real estate values. When mortgage money is relatively cheap, real estate is easier to buy and sell.

Market Area Analysis

Market area analysis (also referred to as neighborhood analysis) is defined as: "The objective analysis of observable and/or quantifiable data indicating discernible patterns of urban growth, structure, and change that may detract from or enhance property values; focuses on four sets of considerations that influence value: social, economic, governmental, and environmental factors." First, we have to identify or delineate the particular market area and then we can start analyzing it. The definition says the analysis must be objective and based on real data. This data also must be observable, quantifiable, and discernible. It also should be capable of verification. The definition then goes on to address the four influences on property values that were the focus of Chapter 12. It says we need to study these influences for patterns that may detract from or enhance property values. That's what it's all about! We gather data and analyze it. Only certain influences are strong enough to actually effect a change in property values. But we need to look at all information to be able to decide which ones are important and which ones are merely circumstantial. This is where an appraiser really earns his or her stripes. Anybody can gather data, but it takes experience, knowledge, training and judgment to be able to make a proper analysis.

Market Area

Market area is defined as: "The geographic region from which a majority of demand comes and in which the majority of competition is located. Depending on the market, a market area may be further subdivided into components such as primary, secondary, or tertiary market areas, or the competitive market area may be distinguished from the general market area." In other words, a property's market area is the area from which its demand is found and that contains its direct competition. Market areas are defined in terms of competition and vary for all kinds of real estate. The market area for a 40-year-old split level house may be other middle-age developments in similar neighborhoods around the city. The market area for a one-year-old contemporary home may be confined to its immediate subdivision or development. That may be the only place where there are similar, new homes. The market area for a log cabin in the woods may consist of any other area in which there are vacation homes within a two-hour radius of a metropolitan area. It would effectively compete with other similar second home properties within a similar commuting distance to the major population center. The market area for a 50-room motel may be countywide or may consist of other motels near any exit of the interstate within 30 miles north or south. The market for a 200-store regional shopping mall could be nationwide or even international in scope. A potential purchaser could just as well come from Japan, Saudi Arabia, or Texas.

Market Segmentation

Market segmentation is defined as: "The process by which submarkets within a larger market are identified and analyzed." This is the process by which we identify a submarket. On the previous page we mentioned different possible submarkets of residential properties. The possibilities are almost limitless. Of course, some of these submarkets can also overlap. For example, we could combine three of the submarkets mentioned in the previous bullet points and identify and analyze the market for single-unit, suburban houses, between $100,000 and $300,000. Or we could identify a submarket as all new condominiums under $100,000. We could further specify that we also want to include only three-bedroom units with one-car garages. That would narrow it down even more. Of course, the same process of defining submarkets could occur in the commercial arena. We could embark on a study of all Class A office space that is between 10 and 20 years old, on the west side of the city. Or we could define a submarket as all high-rise apartment buildings with more than 50 units.

Microeconomics

Microeconomics is defined as: "The study of the economics of individual spheres of activity or patterns and behaviors, e.g., a firm, an industry, a retail market, a consumer segment, pricing, local employment, individual property performance." Microeconomics focuses more tightly on a local market. The definition specifically refers to "individual spheres of activity or patterns and behaviors." Once we define a local market, such as two- to four-unit properties in the city, then we can apply the principles of microeconomics to analyze what is happening in that market. Earlier in the course, we studied the four major influences on value: governmental, economic, social, and environmental. All these forces occur at various levels: national, state, regional, and local. The macroeconomic forces occur at the higher levels and the microeconomic forces occur at the local level. So the forces that we are most concerned with and that have the strongest and most immediate impact are the governmental, economic, social, and environmental forces that occur at the neighborhood or market area level.

Income and Wage Levels

Obviously, the income and wage levels in an area will have an impact as well. Earlier in the course we had a few samples of median income levels in various parts of the country. You need to investigate what the levels are in the particular market area you wish to analyze. Those statistics will be available at the local level in publications by various planning agencies, chambers of commerce etc. They also are available from the Bureau of Labor Statistics at www.bls.gov. There is a direct correlation between the amount of money the typical family earns and the amount they can spend to buy a house. It varies, but a general rule used in the industry is that people can afford a mortgage of about twice their annual income. If your family income is about $40,000, then you can borrow roughly $80,000. Then add the amount of down payment you have available and that should equal the amount of house you can afford. I realize that a lot of people are in houses that are more expensive than that, as compared to their income. During the boom years of the early 2000s, housing affordability became a national problem. Some of this was exacerbated by the availability of cheap financing, which allowed some people to get in over their heads. Housing affordability has improved somewhat due to significant value declines in many markets between 2007 and 2012, however, many markets have appreciated and are now above their 2007 price levels. Income levels for communities are general averages. When analyzing demand for a particular type property, you need to key in on the income levels of the most probable purchasers of that kind of property. If you're trying to ascertain the demand for a new subdivision of $500,000 houses, you need to identify the amount of income that typically would be required to purchase one of those properties. Then identify what segment of the market or percentage of families in that market area would have the means to purchase a $500,000 house. For example, in some markets, a $500,000 house is a "starter house" and there are lots of families who can afford such a property. In other markets, a $500,000 house is a luxury or estate property and there are very few families or individuals in that market who can afford to purchase such a property.

Physical Factors

Physical factors may also limit demand. Topography may dictate which areas can or cannot be developed. For example, the city of San Francisco is built on a peninsula, and almost all the available land has been utilized. With the ocean and the bay on three sides, there's nowhere to go except to perhaps build more vertically and increase the density that way. Los Angeles has sprawled most of the way from the Pacific Ocean on the west to the mountains on the east. Honolulu is restricted in its growth by an even narrower range from the ocean to the mountains. Natural features may preclude future development in certain directions. These may also include: Rivers (Manhattan lies between two) Canals and waterways Swamps or wetlands Canyons

Availability and Price of Vacant Land

Remember we said earlier that land is a finite and irreplaceable asset. Except for those rare instances where small amounts of new land are created by dredging or draining, there won't ever be any more than there is now. In many parts of the country, much of the good land has already been utilized. The land that is left, in many cases, is land that is hard to develop. It may have topographical problems or access issues. So how much land is realistically available for development for different types of properties? How much land can legally be developed for those uses? How much land is physically suited for future development? How much of that available land can be purchased at a reasonable price? If land is very limited in an area, the asking prices may be out of line. Developers are not going to take on a new project if they can't make a profit. If they have to pay too much for the land, they may not be able to sell a completed project for a price that will afford them a profit. The first agent of production was the land, but the fourth agent was the profit for entrepreneurial coordination, after satisfying the costs for labor and capital. The principle of balance emphasized the importance of keeping a proper and market supported balance between property components such as land and buildings. You probably do not want to build a $100,000 house on a $400,000 lot.

Land Use Patterns

Some land use patterns grow up naturally and some are dictated by zoning and planning regulations. Early settlements in our country were primarily dictated by transportation routes. The first areas to be settled were along the Atlantic Coast and inland waterways. Over time, wagon roads were developed and later railroad lines. These influenced early settlement patterns. In 1825 the Erie Canal opened which resulted in new cities being developed along its path through western New York State. In the early 1900s, trolley lines and early highways created new patterns of settlement as workers could live further from their jobs in the city and commute daily. In the 1950s and 1960s, the interstate highway system precipitated new development patterns. Beginning in the 1950s, we started seeing patterns of concentric circles in which the urban areas became surrounded by new suburban housing developments. Then we had new circles for retail and employment centers to service the people living in these new "bedroom communities." (Bedroom community is defined as: "A residential community in a suburban area, often near an employment center but itself providing few employment opportunities.") In recent years we have seen many urban areas become resettled by people who wish to live closer to their work and cultural offerings in the city. They are tired of the long commutes from the suburbs, and their children have gone through the school systems and moved on. We need to analyze existing land-use patterns and be alert to any projected changes. What new projects are on the horizon? What is being discussed in public hearings and in the newspapers? What kind of new developments are in the works? Is it new residential development? Commercial or mixed-use? What efforts are being made towards affordable housing?

Supply and Demand

The analysis of almost any kind of market gets down to a study of supply and demand factors. We need to identify: A property type Particular property characteristics The most probable users of this type of property (demand) Available competing properties (supply) Every defined market has its own particular set of supply and demand characteristics, and these characteristics change all the time. (Remember the principle of change?) We may have analyzed a particular market very thoroughly a month or two ago, but we cannot assume that nothing has changed and that the market has remained static. We constantly have to undertake new research to verify current conditions.

Local Government

The posture of local government, both spoken and unspoken, can affect the demand for real estate in an area. Some governments encourage any kind of growth and others are happy with the status quo and try to put the brakes on development whenever they can. Residential development is generally encouraged by most locales - up to a point. Most government officials like to be able to point to a steady progression and orderly growth in their community. No one likes to see a decline. However, some areas, such as Las Vegas, experienced growth at a torrid pace, putting a strain on the infrastructure and local budgets. The building boom has ended there, but its after-effects are still being felt. Some areas, such as some New England communities, are proud of their colonial heritage and historic structures. They are resistant to change and unbridled development of new housing stock. They can control growth by imposing and enforcing restrictive land-use regulations. In many communities, commercial and industrial growth is a double-edged sword. It is important to supplement the tax base and provide employment for local people. However, the downside is increased traffic, increased pollution, and additional burdens on municipal services. Some municipalities welcome and encourage commercial growth. They may accomplish this through various incentive programs that reward new industries with tax breaks or other considerations. Some are very active and competitive in this arena. The bottom line to all of this is that the policies of local government can and do affect demand for all kinds of real estate. Remember, too, that governments can change. Many of these officials are elected, and periodically the collective opinions may take a new direction.

Population Trends

The study of population trends is about as basic as it gets when we're trying to analyze demand for housing. The more people there are in an area, the more houses that are needed. We already mentioned that the national figures show the average family size is just under three. However, we further pointed out that the majority of households are now occupied by only one or two people. Of all the houses in the United States, approximately 66% are owned, as opposed to being rented. It's important to remember that these are national figures and will fluctuate from area to area. However, it is possible to make general predictions and projections based on that kind of data - particularly if it is modified and keyed into local trends. Here's an example. Suppose that projections show your town will grow by 1,000 people over the next five years. If the average household in your community consists of two people, they will require 500 dwelling units. If 70% of them buy a house or a condominium, that will mean they absorb 350 owned housing units. There will also be a demand for 150 units of rental properties, either houses or apartments. Are there that many units available, or planned? How many new units will have to be built to accommodate this demand?

Costs of Construction

There are certain areas where the cost of construction is extremely high. I mentioned earlier that in Alaska, most of the building materials have to be brought in by ship. The same goes for Hawaii. Even within the continental United States, many areas are relatively remote and pay the penalty of higher transportation costs. Labor costs vary considerably, as well. Labor costs in a rural area of Alabama or Arkansas most likely would be less than they would be in Manhattan or Chicago. Both labor and material costs in more specialized types of construction for commercial or industrial properties may be prohibitively expensive in some areas due to a lack of suppliers or knowledgeable technicians. All of these things could have a practical impact on the amount of new construction one could expect in a market area.

Market Study

There are different types of market analysis that may be conducted. Market study is defined as: "An analysis of the general market conditions of supply, demand, and pricing for a specific property type in a specific area." Market studies concentrate on market trends. For example, a market study might be undertaken by a developer prior to planning a new development or project.

Feasibility Analysis

This is a similar type of analysis that may be conducted by an appraiser as a service to an investor. A feasibility analysis is defined as: "The study of a cost-benefit relationship of an economic endeavor. (USPAP, 2016-2017 ed.)" A feasibility analysis often is conducted as part of a study in developing an opinion of highest and best use. Remember, the third criterion for highest and best use is financially feasible. This means the appraiser must analyze whether a potential use is financially feasible in order to determine whether it is the highest and best use. In some assignments, an appraiser may be required to analyze the financial feasibility of a number or potential uses. Remember the definition of investment value? That is the value of a property to a particular investor, according to his or her own particular investment criteria. A feasibility analysis for an investor would result in an opinion of investment value.

Marketability Analysis

This is another type of service that can be performed by a competent appraiser. A marketability analysis is defined as: "A study of how a specific property is expected to perform in a specific market. A marketability analysis expands on a market analysis by addressing a specific property." Previously, we defined market analysis as: "The study of the supply and demand in a specific area for a specific type of property." A market analysis studies the supply and demand for a specific type of property, e.g., new single-unit dwellings with 3 bedrooms, 2 bathrooms, and 1,500-1,600 square feet. A marketability analysis differs from a market analysis in that it addresses a specific property, e.g., the new single-unit dwelling located at 123 Elm Court.

Employment Types and Patterns

This type of analysis is directly linked to the previous topic of income levels. You need to analyze the existing and projected types of employment in a market area. Does the local employment consist primarily of: Manufacturing? High-tech? Government? Education? Services? Tourism and recreation? Retail and small businesses? What have the trends been over previous years? Are they changing? If different types of employment do come into the area, how will this affect income levels? Is there a significant portion of the population that work independently at home? Or for outside companies? How do their wage levels compare? Is employment steady or does it vary from season to season? What is the availability of skilled labor in the area?

Supply Analysis Factors

We always have to analyze both sides of the equation. An analysis of demand really tells us nothing until we see what is available in the way of supply. In supply analysis we may research and investigate: Existing stock Volume of new construction Planned construction - new building permits Availability and price of vacant land Costs of construction Properties offered for sale Conversions in progress Availability of financing

Mortgage Information

We have already stressed the importance of mortgage availability, particularly in the residential real estate market. This has a direct impact on the amount of new construction and also applies to the number of sales of existing properties. Interest rates are a big factor. But other mortgage terms are also important. The amount of down payment is a large determinant of housing affordability. In times of a tight money supply, it is quite common to require down payments of 20% or more. This certainly weeds out the number of people who are able to purchase. Not everyone is able to save a significant amount of cash to put down on a house. During the early 2000s, we stated that it became quite common for conventional mortgage loans be offered for 90% to 95% of value, or even more. These low- or no-down-payment mortgages seemingly dried up after the housing and credit crisis, but have recently begun to make a comeback. It still remains possible for veterans to get a VA-guaranteed loan for 100% of a property's value. FHA mortgages typically only require a 3.5% down payment. Regardless of whether one believes these low-down-payment loans are a good thing or a bad thing, the fact is they open the door for many people, who might otherwise not be able to put together a significant cash down payment, to be able to purchase homes. Variable or adjustable interest rate loans also encourage home ownership because the monthly payments are reduced at the beginning. However, these types of loans have their pitfalls as well, particularly when the borrower's income does not keep pace with the resetting adjustable rates.

Availability of Financing

We have visited this topic several times over already. But it keeps coming back. It's a fact of life that houses, commercial buildings, condominium units, apartment buildings, etc. are not going to get built without adequate availability of financing. Financing availability is an essential and ongoing component of the analysis of real estate supply.

You need to investigate and keep abreast of population trends in your market areas. You may need to answer questions such as

What is the percentage of population change over the last one year, five years, and 10 years? Is it a positive change or a negative change? Is the percent of change increasing, decreasing or staying constant? How does this compare with the other municipalities in the area? How does it compare with other counties? How does it compare with the state and nation as a whole? Is your market area growing faster or slower than the average? What percentage of the population is in various age categories? For example, how many are between 20 and 30 years of age and how many are 65 and over? Which are the fastest-growing communities in your area? Which are the slowest growing communities in your area? What are the projections for the next one year, five years and ten years for population change? Population demographics usually emanate from the U.S. Bureau of the Census. If you want good, current, local data, please click on the link below, which will take you to the Census Bureau website. On the Census Bureau website, go to the "Topics" tab on the top of the page, and it will bring up a list. Click on "Population", which will take you to a new page. Click on the link that says "Population Main", then "Population Estimates", then "Vintage 2017 Tables", then "County Population Totals and Components of Change." Then you can click on your state and county.

Existing Stock

When analyzing supply in a residential appraisal, existing housing stock is always our starting point. That represents the maximum supply of any kind of real estate at any given moment. Finding the existing supply is easier with a specific type of commercial or industrial property, as there are generally fewer of them. We may be able to physically count or reckon off the top of our head how many motels there are in town or the number of bowling alleys. If we want to know how many restaurants there are we could probably just do a Google search or look in the Yellow Pages and total them up. It's generally harder with residences, but that kind of information is available, too. A quick visit or phone call to the assessor's office may yield an accurate count of residential properties. Estimates of the number of housing units in various areas are also available from the Census Bureau website. I'll give you some specifics on how to find that a little later. But at any rate, standing stock is a firm number. Perhaps there are 12,016 one-unit residential properties in the town, village or county and 628 commercial properties. That's all there is! That is the total supply at this very moment. However, we have to go beyond that number and analyze the potential for change.

Demand Analysis Factors

When completing demand analysis for commercial properties, we may research and analyze factors such as: Population of the demand area Per capita and household income Percentage of household income spent on retail purchases Rates of sales retention in the trade area Vacancy rates in the market area Transportation facilities Land use patterns and the direction of growth