4 Reasons Why It's Vital to Understand Your Local Market

As an agent, it’s imperative you know the ins, outs, ups, and downs to understand your local market like the back of your hand. It’s more important than ever: The National Association of REALTORS® 2023 Home Buyers and Sellers Generational Trends Report asked buyers what skills and qualities they considered “very important” when working with an agent.

The results? A staggering 91% of buyers wanted an agent with solid knowledge of the real estate market. It’s clear buyers need an agent, not just for the transactional expertise they possess, but their in-depth knowledge of the local market.

Why It’s Crucial to Understand Your Local Market

Today’s buyers are overwhelmed by a variety of information sources, usually found online or in news headlines. Misinformation can run rampant, or they’re only getting a national view of the real estate market, hampering their own knowledge of the market they live in. Without an agent’s expertise of the local market, prospective buyers may not even proceed with attempting to purchase a home. 

When you work with buyers, they need you to cut through the noise, give them deep insights they couldn’t access elsewhere, and to break down what’s happening in their own market at a local level.

4 Reasons Why You Need to Be an Expert in Your Local Market

It’s clear buyers need you and your expertise to give them a well-rounded, clear, and realistic picture of what’s actually happening in their local market. But why is it so important to go beyond the basics of a typical home transaction? Here’s 4 reasons it’s vital to understand your market.

#1. You Know the Data

Real estate agents have access to unparalleled real-time market data buyers can’t easily get. As an agent who understands your local market, knowing the neighborhood numbers in-depth — and being able to easily define what they mean — is important.

You have access to data encompassing market factors like:

• How much homes are selling for
• How long homes are on the market
• How hot the market currently is
• How interest rates are impacting the market

While consumers can dig up this information online, it’s not always the most accurate or timely. And not all listings posted online will have this information, nor will they be able to break down what it all means in a clear, concise way like you could.

Having this data and deep awareness of your local market also empowers you to be a better agent to your client. You can advocate for them more easily, help them understand the process as it stands today, and ensure they’re seeing properties that align with what they need.

As an expert in the market, you’re the guiding light of what clients need to know to be in the best position to purchase — and what information overload they can scale back. In turn, they can get set up for a more seamless transaction. All the while, you get to reinforce your in-depth aptitude. 

#2. You Can Help Clients Understand their True Buying Power

Similar to browsing listings online, not all buyers know their true buying power once they start their home search. While they may be pre-qualified or pre-approved for a mortgage loan, they may not be aware of shifts or changes in the local market that can impact their purchase power.

This is where you swoop in to save the day. Equipped with knowledge of how transactions are looking in the local market currently, you can clearly explain to buyer clients what they’re realistically capable of purchasing with powerful market trends. You can also inform them of the impacts (if any) the market is having on their buying power, and how they can best prepare to make an offer on a home — to name just a couple of examples.

#3. You Can Build Trust Early On

When you come to the table with deep, intimate knowledge of the market and how everything is running from a realistic, data-backed perspective, buyers’ fears can be calmed and their questions can be answered. NAR’s 2022 Profile of Home Buyers and Sellers uncovered a whopping 97% of buyers valued the honesty and integrity of their agent the most, highlighting their need to feel they can trust who’s guiding them through the buying process. 

Because you’re empowering them with real-life data not easily accessible to consumers, they start to view you as an expert they can rely on. In turn, you can start to forge and strengthen trust early on in your conversations. 

#4. You Can Overcome Objections More Easily

When you have a deep understanding of your local market, you also have a strong grasp on its unique concerns that can lead to objections. Think of this like being ten steps ahead of the game.

Because you already know these market details, and learn about them regularly through your brokerage, colleagues, market reports, and more, you’re well-equipped to handle any concerns, objections, or pushback clients send your way.

And, since you’re also deeply familiar with the local area, you can tailor your approach to overcoming these objections in a more personable, relatable manner.

Start Helping Local Buyers

It’s not enough to simply master the transaction process — it’s vital you understand your local market and stay on top of changes, trends, and any shifts, which will allow you to better serve your clients and build trust early on.

If you're ready to show off your expertise of the local market, login to your RealEstateAgents.com profile to get in touch with clients today.