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I just posted a blog entry about the latest in the national real estate news, as reported by Yahoo! Finance. It’s only fair that for comparison purposes we look at how the local market in Cincinnati, Ohio is doing as well.

September Home Sales Off 15% (Adobe .pdf version of the Cincinnati Enquirer article)

While the market is pretty slow here in Cincinnati, it’s not as bad as the national average. Of course, the national averages are being driven more by the larger markets and areas that are experiencing much sharper declines - such as many parts of California and Florida. The Cincinnati Enquirer article does a good job of summarizing the softening in sale prices and the supply of homes on the market.

The recent withdrawl of some prominent and national home builders from various new subdivisions in and around Cincinnati (namely Ryan Homes as mentioned in an earlier blog entry) has increased the supply of homes available in the short term through the sale of the already constructed model homes and any speculative construction - or “spec” - homes. The fact that these builders have stopped building new homes here will help ease the 10+ month supply of homes that are currently on the market. This is a much better scenario for the local real estate market in the long term.

It would be mostly through the sale of model homes though, as not many builders have been undertaking speculative construction in the past year. Speculative construction is when the builder will start to build a home before a buyer is found, in contrast to the pre-order scenario where a buyer picks out a plot of land, signs a contract with the builder and then has the home built.

As always, I appreciate your comments and feedback…

Home Sales Plunge 8% (Yahoo! Finance News Article in Adobe .pdf format)

We all know it’s a tough market to sell a home, so this news doesn’t come as a surprise. For sellers, this is the worst market in 16 years… and this article from Yahoo! Finance points this out: “more problems to a housing industry in its worst slump in 16 years.”

While I realize this sells a lot more newspapers than if you tout that this is the best market for buyers in 16 years, I don’t think it’s fair to paint the real estate market as something people should go running away from as fast as possible. That 8% decrease in sales means that people who are currently renting and can afford to purchase a home have more buying power now than they’ve had at any time in the past 16 years.

To further the point, those that can’t afford to purchase and those being foreclosed on and can’t afford to stay in their homes are driving up monthly rent prices in many areas of the country (yet another excellent buying opportunity for real estate investors/landlords - falling prices and increasing rental income).

I guess what it comes down to is this: if your area of the country is anything like the national average or trend of falling prices and increased buying power, anyone that is 34 years old or younger has the best buying opportunity in their lifetime (since turning 18 and becoming legally able to purchase real property).

So this news, while it’s not a surprise and it is not a good sign for sellers, is actually a good thing for buyers. It would be nice to hear the news tout the pleasant news for buyers rather than continue to bad mouth the industry. The media is essentially representing the seller-side in its reporting.

As always, I welcome your comments and feedback…

This is the introduction to a new article that I’ve written. You can read the full article by clicking on the link below to the Cinventure website.

Donald Trump is known for saying “there’s no such thing as too much exposure.” And certainly no one would disagree with this when you think about the good exposure. But I would venture to guess that no one likes bad press. And the only thing second to bad press is ineffective good press, or better stated… advertising that just doesn’t work.

Read the full article on the Cinventure website. Cinventure.com is a website for entrepreneuers. As a contributing author and blogger on the website, you will find this full article and many others written by myself as well as other entrepreneurs and bloggers like Aaron Forgue and Ryan Walker. You can read all of them free of charge and even subscribe via RSS or email.

As always, I welcome your comments and feedback…

The US Census Bureau is a great resource that most entrepreneurs over look. Aside from all of the excellent demographic information that you can find, the Census also handles industry classification codes, known as NAICS (pronounced nix), which stands for North American Industry Classification System. While it is certainly important to understand the demographics of an area to better target your advertising and marketing, it is equally important to understand who your competitors are, and the Census Bureau can help us there, too.

The NAICS code for a given business will be six digits long. For instance, I am engaged in the sale of real estate. But if you type in Real Estate into the search box on the NAICS website, you get numerous results. There is Lessor of Nonresidential Buildings, code 531120. Since I am a Realtor, I am better classified under Offices of Real Estate Agents and Brokers, code 531210. This is a good time to point out that any one business could fall into multiple class codes. If I was a Realtor that also handled the leasing of non-residential buildings, both codes might apply. You certainly wouldn’t be able to put General Electric into one classification code; rather, you would have to determine a number of codes that apply to its divisions.

One more important thing to note: the classifications can be very broad or very narrow. The more zeros there are at the end of a classification code, the broader the label. For instance, code 445000 is Food & Beverage Stores. Code 445100 is Grocery Stores. Code 445120 is Convenience Stores. This helps identify the industry and any particular niches within the industry.

So where am I going with all of this? If you know the classification that applies to your own business, your products and services, and your industry in general, then you can identify a number of things. You can identify who your greatest threats are with respect to competition. Then there are potential new customers if you’re a Business-to-Business (B2B) entity. You can even see whom your suppliers’ competitors are in your supply chain to help you find the best prices for the things you need to run your business.

So you’re saying to yourself: so I have a few numbers scribbled on a sheet of paper. What do I do with these things?! Well, aside from scouring the Internet and researching individual companies, my best advice is to walk into any public library and head to the reference section. Ask any librarian where you can look up companies by NAICS codes and they should have a directory to assist you. You may have to specify the full name of the NAICS when asking for its directory.

Also, as a brief side note, the NAICS replaced the US Standard Industrial Classification system (known as the SIC). Since the NAICS is relatively newer, you will see references to both codes. Just know they are essentially serving the same purpose, to identify industries and classes of businesses.

This same data can be used by investors when deciding whether to invest in a company or not! Using this data can help compare a company to its peers and the industry as a whole. Is the company considered a leader or a laggard?! Even if they are a leader, is this an industry that you want to be investing in right now?! This data helps find answers to these questions.

As always, I welcome your comments and feedback…

You will notice that I posted this same entry on the Cinventure.com website, where I am a regular guest blogger. CinVenture is a website geared toward entrepreneurs in the Cincinnati, Ohio metropolitan area (but is not restricted or limited to people in the area). Please check out the other interesting articles and links on the CinVenture website… and tell them Thomas Goodwin sent ya!!! Well, better yet… subscribe to the feed or check back often to get the latest news and columns on business start ups in the Cincinnati area! Leave comments and feedback, network, and feel free to email and submit ideas for new articles. We’d love to hear from you on CinVenture AND on ThomasGoodwin.com…. Thanks!