The Importance of Demographic Research
Demographics is statistical data relating to the population and the particular groups within it. It is the kind of information that makes working in the real estate world a pretty challenging feat. Also, it is an indispensable part of the business, since it plays a great role with marketing houses and properties.
How important is demographic research? Well, this research provides the data that describes the composition of a population, such as age, race, gender, income, migration patterns and population growth. These statistics are an often overlooked but are a significant factor in how real estate is priced, what types of properties are in demand, and who is interested in buying what. Major shifts in the demographics of a nation can have a large impact on real estate trends for several decades. For example, the baby boomers who were born between 1945 and 1964 are an example of a demographic trend which will likely influence the real estate market.
There are numerous ways this type of demographic shift can affect the real estate market, but for an investor, some key questions to ask might be: How would this affect the demand for second homes in popular vacation areas as more people start to retire? Will they be able to even find buyers for their homes if they do decide to sell their property? These and other questions can help investors narrow down the type and location of potentially desirable real estate investments long before the trend has started. Basically, the ever-changing results in demographic research determine the demands, prospective buyers and also the prices of properties. Who is buying what? Who is interested with what? Is it part of their priorities?
Know this important data in your market because the more information at hand, the better decisions you will make.