The #1 Factor That Leads to Home Price Growth (You CAN Predict This)

On The Market

BiggerPockets

News, Investing, Business, Education

4.8 • 820 Ratings

🗓️ 20 February 2025

⏱️ 26 minutes

🔗️ Recording | iTunes | RSS

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Summary

There’s one key housing market factor that leads to home price growth. It doesn’t have to do with interest rates, property taxes, or weather. This single metric is the strongest predictor of your home price rising, staying stagnant, or falling. If you know where this metric is peaking, you can follow a data-driven trail to housing markets that will soon have higher home prices and get in before the masses. What’s the secret metric we’re talking about? Well, it’s not so much of a secret. This metric is easy to find online and can help you pinpoint markets with the highest potential for price growth. So, if it’s so easy to find, why isn’t every real estate investor using it? Mainly because most investors don’t know how important this metric is. But today, we’re showing you exactly how to track where home prices could rise, how to pinpoint the neighborhoods within your market that could experience high price growth, and why this easily available predictive metric may change as the economy shifts. In This Episode We Cover The number one way of predicting whether home prices will grow in an area How this metric strongly influences migration and brings more demand to cities Where to find this data for free and the easy way to predict home price growth Trends to start watching now that could foretell which cities will rise (and shrink) How to find the fast-growing (and stable) neighborhoods to invest in within your city And So Much More! Links from the Show Join the Future of Real Estate Investing with Fundrise Join BiggerPockets for FREE Find an Investor-Friendly Agent in Your Area Dave's BiggerPockets Profile BiggerPockets Daily 1431 - 12 Cities You’ll Regret You Didn’t Invest In 10 Years From Now Bureau of Labor Statistics Austin's BiggerPockets Profile Grab Dave’s Book, “Real Estate by the Numbers” Jump to topic: (00:00) #1 “Growth” Metric (04:01) Could Remote Work Change This? (08:13) These Jobs Push Prices UP (11:06) How to Predict Market Moves (15:45) Trends to Watch (19:15) Finding Growing Neighborhoods Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/on-the-market-297 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [email protected]. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Today, we are breaking down the number one metric that predicts real estate growth.
0:10.2	Our in-house analyst, Austin Wolf, has found that tracking job growth can reveal where
0:15.5	home prices and rent prices are headed often long before anyone else.
0:20.8	And if you've been burned by guessing
0:22.1	market potential, this data-driven approach could change how you invest. I'm Dave Meyer, and welcome
0:28.3	to On the Market. Let's dive right into today's topic with Austin Wolf. Austin, welcome back to
0:34.4	On the Market. Thanks for being here. Happy to be here. Tell us a little bit about
0:38.3	the project that you've been working on and what we're going to be going into today. Yeah,
0:42.8	so I spent a lot of my time on this show and an article is talking about one specific metric.
0:48.6	And I usually always lead with this metric, but I rarely explain why I lead with it. And in my
0:53.2	opinion, this is the number one metric
0:55.2	that investors should be looking at when they're comparing different markets. And to me,
1:00.2	that's job growth. So generally, your hypothesis here is that for a good real estate investment,
1:07.5	you need a place with increasing demand. So you want more people who need to
1:12.5	buy homes or to rent apartments. For that, you generally want population growth or household growth.
1:19.0	And if you take a further step out and say, what's going to predict that demand, you're saying
1:25.8	it's jobs. People are going to move to where jobs are.
1:28.2	Yeah. If we look at, I hate to use this example because it's overused, but the most dramatic
1:33.4	example is Detroit, you know, due to the manufacturing offshoring that occurred. You know,
1:38.0	Detroit has been losing population over the past 50 years. Last year is an exception. The first time
1:43.4	in 50 years, it actually gained population.
1:45.7	Oh. But yeah, that's because the industries are starting to diversify and attract new talent
	...

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