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A former physician who became intrigued with real estate and real estate investing along the way, I now run Redfish Emerging Markets, a real estate market data and research company, and invest in multifamily projects around the country.
We agree with the comments thus far about the DOM data. We track roughly 180 data points in markets across the country for single family and multifamily investors - we don't track DOM data as we find there are other more correlative indicators of inventory and absorption. Mark McGlothlin, MD CEO, Redfish Emerging Markets www.RedfishEmergingMarkets.com/blog Bozeman, Montana
We've (my team at Redfish Emerging Markets) provided some pretty spirited commentary regarding the media's interpretation of the CSI result over the past couple of months. With real estate market conditions what they are today, and with the degree of variability present market to market, there's a genuine risk of missing the market boat in a given market by trying to extrapolate market conditions from the CSI. Our point is this - careful, detailed, and accurate research is necessary before deciding what's happening in a given market today. We don't have a beef with the CSI and what it indicates for the markets it covers. You just can't paint every real estate market in the country with the same brush without digging for the facts. Mark McGlothlin, MD, CEO Redfish Emerging Markets Bozeman
Excellent post, Sean. Cap rates (NOI Before Debt Service/ Sales Price) make great sense in the commercial world (I'm a multifamily investor) and your premise is right on in getting people to think about single family price / valuation in today's markets. Comparable sales based valuation has contributed greatly to the mess in single family right now - it's probably quite a reach to think that changing to an income capitalization approach in single family could work, but it does truly make sense. My team agrees that there is a bottom to come. We find in our market research studying 286 markets around the country that price / value stabilization has a great deal to do with affordability measures, which if you think about it right in step with what you've said in your post. Finally, there are markets that are thriving right now, and markets that have a great deal of correction and pain yet to come. The savvy buyer/ investor is taking a long hard look at market fundamentals..... Mark McGlothlin, MD Redfish Emerging Markets
