| Demographic trends influence almost every | | | | future of his business, as is the economic |
| aspect of life, from business planning to | | | | health of the region. |
| provision of healthcare, from education to | | | | |
| style. Age, income, ethnicity, gender, | | | | |
| mobility, employment and other demographic | | | | |
| factors determine the shape of our society. | | | | "I look to see how fast the economy is |
| | | | growing here in Bend, and how many jobs are |
| | | | likely to be created as a result, to |
| | | | determine the resources my business will need |
| Real estate is no less affected by the ebbs | | | | over the next five years," says Oregon, real |
| and flows of demographic trends, particularly | | | | estate broker Terry Denoux. |
| income, aging, family situations and | | | | |
| employment. | | | | |
| | | | |
| | | | Development planning relies even more on |
| | | | demographic data to determine priorities. |
| For commercial real estate investors, the | | | | The average age of the population is a major |
| stakes are particularly high. Investing in | | | | factor in the type of housing that will be |
| commercial real estate, for example requires | | | | required over the next couple decades. |
| the ability to forecast where there will be a | | | | |
| growing population, and/or where the | | | | |
| population's average income will be | | | | |
| increasing. | | | | "A young population in an area will require |
| | | | more single family homes with multiple |
| | | | bedrooms and plenty of space for children to |
| | | | run," explains Wendy Cobrda. "On the other |
| In fact, commercial property investment | | | | hand, an aging population will need more |
| requires a deeper understanding of | | | | hospitals, more medical clinics, more housing |
| demographic data; it is not just the | | | | that requires minimal maintenance." |
| population trends that need to be considered, | | | | |
| but the demographics of the competition. And | | | | |
| even those cannot follow a set formula. | | | | |
| | | | Demographic data plays a role in vacation |
| | | | rental real estate, too. "Do you buy |
| | | | vacation rental properties, or do you sell |
| For instance, an entrepreneur looking to set | | | | the ones you have now?" asks Steve Curtis, |
| up a new car dealership needs to consider | | | | owner of , a vacation rentals lisiting site. |
| where established dealerships are located and | | | | "Well, that depends on how much disposable |
| set up shop nearby. Car buyers wanting to | | | | income people have for vacations and, more |
| compare similar models need to visit several | | | | importantly, on the age of the population. A |
| dealerships, so they need to be close to one | | | | younger person is more likely to backpack |
| another. | | | | through Europe, and stay at a hostel. An |
| | | | older person in more interested in comfort |
| | | | and privacy, which is what vacation rental |
| | | | properties offer." |
| On the other hand, an entrepreneur looking | | | | |
| to set up a new hardware store, should look | | | | |
| for an area underserved by the competition or | | | | |
| where new residential developments will be | | | | It also depends on where populations are |
| opening up. Hardware shoppers can compare | | | | growing more, as well as where the affluence |
| brands of similar tools within the same | | | | is growing. If an economic boom is happening |
| store, so ease of access takes on a greater | | | | in England and France, but not in the USA and |
| importance. | | | | Canada, a vacation rental in Spain might |
| | | | prove more useful than on the Gulf Coast of |
| | | | Texas. |
| | | | |
| Speaking of ease-of-access, traffic patterns | | | | |
| can also make a difference, especially near | | | | |
| busy intersections. The demographics of | | | | "Business planning is just a shot in the |
| traffic can add to the complexity of making a | | | | dark without solid market data," explains Ms. |
| commercial real estate investment. | | | | Cobrda. "Demographic data reports and maps |
| | | | help businesses project market activity into |
| | | | the future, helping to avoid such |
| | | | catastrophes as building stores with no |
| Understanding where to invest in retail | | | | customers or storing a few million dollars of |
| properties is one of the main reasons that | | | | inventory that nobody wants." |
| demographic mapping is such a popular | | | | |
| service," explains Wendy Cobrda of Catosphere | | | | |
| demographic data reports. "To visually see | | | | |
| the movement of people and their spending | | | | Given the high ticket price of real estate, |
| dollars helps businesses 'see' where they | | | | whether residential, commercial or vacation |
| should open their next store." | | | | rentals, demographic reports and market |
| | | | segmentation data are even more |
| | | | important.David Leonhardt is a Canadian |
| | | | freelance writer. He wrote this article for |
| Consider also a real estate broker, whose | | | | Catosphere, a US demographic data reports |
| livelihood depends on people changing homes. | | | | company and for Go Bend, an Oregon real |
| Economic mobility is a key determinant in the | | | | estate brokerage. |