We talk about the “housing market” a lot. But as much as it sounds like there’s a nationwide market (and there is), in actuality it’s made up of hundreds of smaller markets. Each city can be considered its own macro real estate market. And even within cities, there are sometimes dozens of micro real estate market areas.
WHAT IS A MICRO REAL ESTATE MARKET?
Micro markets range from broader areas like neighborhoods to smaller sections of the city. Subdivisions, areas taken from the grey areas between neighborhoods, and localized slices of a city or region’s overall housing market with their own defining features.
Even though each city or region can be called a “market” with its own distinct trends and viability, micro markets matter more when you’re actually buying a home. That’s why it’s crucial for you to hire an agent who intimately understands Chattanooga’s various micro markets.
These smaller markets can be distinguished by school accessibility, businesses, and parks. They’re all ways of predicting how viable the market will remain, and for how long. If a neighborhood’s businesses are suffering, you can bet that real estate prices will go down. If they’re starting to pick up, it’s safe to assume that home values will rise.
Macro trends, micro effects
Trends in micro markets affect the macro market as a whole. But events in the economy of the city affect micro markets even more. A growing neighborhood could lose hundreds of jobs with layoffs at a large employer. In the same way, the city’s work to gain a big company (like an automaker or large retailer) can lift home prices in neighborhoods that had been stagnant.
How do micro markets affect me?
A better question would be “how DON’T they affect me?” Homeowners are affected by changes in their own neighborhoods. Property values can rise – or fall – based on the selling price of homes in the area. Business closures, school ratings, and increased access to major roads all affect micro markets and those who live in them.
A good realtor, whether they’re working for the buyer or seller, can do wonders to use micro markets to your advantage. Here’s how that would work:
If you’re selling your home, your agent should be able to accurately price it. They won’t just look at overall trends. They’ll go in-depth to understand your home’s context within a narrowly-focused area of just a few blocks. That leads to buyers who understand your home’s value – right where it is. And they’re more likely to make an offer that’s favorable to you.
Buyers benefit from agents who understand micro markets in much the same way. When the right realtor is helping you buy a home, they’ll help you steer clear of homes that are overpriced. On the other hand, if a home is underpriced, they can tell you – and find out the reason. And they’ll be much more qualified to help you find the area of town that’s best suited for you.
When you’re looking to buy a home in Chattanooga, it helps to understand the market. Being able to look at the micro markets to gauge trends and future home values is key.
That’s why Jim and Monique Lea have spent so many years as the top agent team in Chattanooga. The Lea Team has in-depth experience with micro markets. And we can put that knowledge to work for you.