Los Angeles, CA – Real estate veteran Moses Kagan recently emphasized the critical importance of local market dynamics over national trends, asserting that "Real estate is a local business." In a widely shared social media post, Kagan, co-founder of Adaptive Realty, highlighted a common pitfall where individuals mistakenly apply broad national market narratives to specific submarkets, leading to inaccurate assessments. His statement reinforces the long-held industry adage that "all real estate is local."
Kagan, whose firm Adaptive Realty manages approximately $200 million in Los Angeles apartment buildings, stressed that while national discussions often dominate headlines, the true market for any property exists within its immediate submarket. "When everyone is talking about 'the market,' they're talking about the national market. Your market is your specific submarket. That's it," he stated, urging a granular perspective for effective decision-making.
Industry experts and data from organizations like the National Association of REALTORS® consistently differentiate between national and local real estate trends. National trends provide a broad overview, influenced by macroeconomic factors such as interest rates and government policies, offering insights into the overall health of the real estate market. However, local markets, defined by individual cities, neighborhoods, or regions, are shaped by unique economic conditions, demographics, and supply-demand imbalances.
Understanding these localized factors is crucial for buyers, sellers, and investors. For instance, a strong regional economy or specific local developments can lead to thriving real estate conditions in one area, even if national indicators suggest a slowdown. Conversely, localized oversupply or economic shifts can impact a submarket disproportionately.
Kagan's perspective underscores the need for stakeholders to consult local real estate professionals who possess an intimate understanding of their specific areas. These local agents and investors can provide nuanced insights into property values, demand, and investment potential that national data alone cannot capture. This localized approach is vital for navigating the complex and often divergent realities of the real estate landscape.