How to Pick Counties

I’m analyzing several counties now by looking at sold properties for the last 12 months on Redfin. One piece of advice I read was to pick counties that have sufficient activity that you will have good chance to quickly sell any aquired properties. However, if an area is “too hot” it may be too difficult to find discount properties to purchase. My question is what is considered “too hot”? One county I analyized had 79 sales in last 12 months in the size property I would like to target. Other counties had about 40 sales and some as few as 20. Any rules of thumb when targeting based on past sales?

@steve-vw keep in mind, a “county” is not a consistent way to measure this, because some counties are MUCH bigger than others, and some have much more vacant land than others.

Just look at a US county map, and you’ll see that the further you go west, the bigger and bigger they get.

79 sales in the past 12 months may be a lot for a county on the east coast, but not much for a county on the west cost.

Also, consider the fact that a “sale” isn’t an apples-to-apples comparison either. Are we talking about sales of $5K vacant lots or $1 million+ ranches? My point is, you have to understand what kind of properties YOU are going after, and use that to understand the relevance of whatever sales you see.

I’ve always looked at days on the market and the number of views each listing is getting, as more relevant numbers, because it indicates how long properties are sitting on the market before they sell, and how much interest each listing is getting.

I mean… all the numbers offer clues in their own way, but looking solely at the number of sales in a county is a very incomplete picture of what’s going on.

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@retipsterseth Great points, thank you. I was thinking that the counties in the west (where I am looking) might be too large and it may make better sense to analyze by zip code and batch letters by zip code rather than county.