Should You Really Own A Piece of The Rockford?

The "It's the supply! vs. the "It's the demand" argument about residential property prices often reminds me of the era of the "Tastes great!" and "Less Filling" commercials from years ago. When performing the important job of researching for real estate, the emphasis needs to be on both factors. It's the great debate of whether supply influences demand vs. demand influencing the supply.

 

There might not ever be a better of example of why this is so important than the current situation in Rockford IL. Having spent the majority of my life within two hours of Rockford, I'll just say that it is not a place I have ever spent any more time than necessary when there. Although there has been noteworthy improvement over recent years, the city is far from having been 'transformed' into a vibrant and rising area.

 

Yet, if you research by "demand", Rockford is a hot spot for home buyers. However, if your research takes you to population trends for the area, you either find them between 'steady' and 'decreased' over the past 10 years. That's where 'supply' comes in. 

 

The number of blue collar jobs and comparably lower priced homes is currently the big appeal. However, it's obvious, upon research, that there are not enough single-family homes to house the current population. There is no "rising" population to be found.

 

If you only look at demand, you would think that Rockford is an attractive place to build single-family housing. Some developers and investors only look at demand. Here is one case where that could be a mistake. Supply chain and construction costs are rising. It takes months and maybe longer to build a development or cluster of houses. By that time, the local "demand" may not even be as strong as it supposedly is at this time.

 

 

 

You can perform partial research, or you can make guesses on your own. My team and I are ready to provide you with (or train you to do your own) customized research to guide you toward future real estate success!

 

 

https://www.illinoispolicy.org/rockford-declared-hottest-housing-market-in-u-s-but-low-supply-is-real-story/