Getting to know your market

[Matt Burgess]

Just from listening to the BiggerPockets podcast, it is clear that getting to know your market is both extremely important and something you can/ should do while preparing to purchase that first property. I have been on Zillow daily checking both properties that are currently for sale and that have sold recently. I also check what current rent prices are like. Does anyone have any other tips/ tricks to getting to know your market? I am looking to take a deeper dive to reach a more thorough understanding. Also, outside of just simply getting a grasp on what prices are looking like, what else do you look for in a market? (Any key statistics, trends, etc.) Any advice is greatly appreciated!

[Javier A. Batlle]

@Matt Burgess:

If you are a long term buy&hold investor, you should definitely look into income statistics in the area/zip code, and compare those to rents (Rent-to-income ratio). This is, for me, a crucial thing to know as it basically determines whether rents can go up in the future. Usually you are looking for a RTI ratio lower than 30%, ideally around about 20%, which means that the average renter's budget has enough room to keep paying rent even if it goes up with time. 

Job creation is another one to look out for. You can usually find these data in sites like the US census beaureau and other gov sites.