Fundamental and Technical Real Estate Analysis

There are two main schools of stock investment: fundamental analysis and technical analysis. Both of them have their merits, according to the masses, but I don’t believe that technical analysis is a sound approach to stock investment.
I’ll briefly explain both approaches.
Fundamental analysis deals with exactly what it sounds like: the fundamentals of the company. This means the potential investor will examine the company’s track record, its financial statements, its management, its market sector, its geographic location, and all other things that make that business that business. Fundamental analyzers look at these things to arrive at a conclusion of the company; from this data, they decide whether the company is a good or a bad one and whether or not they should invest their hard-earned money into it.
Technical analysis ignores all of this. Instead, somebody using the approach of technical analysis will look at the trends in the economy, the trends in that business, and its history of trends. In short, they look at the charts of the prices of that company’s stock. These charts are examined for patterns, and the technical analyst will try to predict the future price of the stock based on these patterns.
I don’t know about you, but it makes a lot more sense to me to pay attention to the company itself rather than the prices of the stock. Warren Buffett, the most successful stock investor in the world, says that in the short term, the stock market functions like a voting machine, but in the long term, it functions like a weighing machine. The good companies will come out on top. So, what are you going to look at, arbitrary patterns or whether the company itself is a good or a bad one?
These two approaches can also be found in real estate; anyone in commercial property management can focus on the fundamentals or the trends. What are the fundamentals in real estate? The fundamentals consist of geographic location (proximity to highways, major cities, etc.), the school district (if the property is a home or apartment), the construction material of the home (brick, stucco, or wood), the number of bedrooms and bathrooms, whether the house has a basement or not, and many others. Or, the investor can focus on the prices of the building over the years. The prices of the property prove nothing, as the patterns are again arbitrary, and predicting the future is impossible. You may have guessed correctly, but nobody has a crystal ball. Instead, focus on the real things that make up the investment, the fundamentals.

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