The Importance of Market Research in the Investment Project Planning Process

We are witnessing a positive trend that has been happening on the real estate market in Serbia for some time, and with the constant growth in demand, we expect that it will continue in the coming period. In the cyclical movements that are specific to the real estate segment, our company has been adapting, introducing innovations and expanding the range of services. Regardless of market conditions, we continue to educate the market and emphasize the importance of strategic consulting and detailed initial analyses during project development and before entering into an investment, in order to build a project adapted to market needs.

How and why is it performed?

Real estate market analysis is the process of collecting and processing relevant data in order to gain a deeper understanding of the real estate market and current trends. In less developed markets, many investors do not recognize the importance of this analysis, because the supply is limited and mostly everything that is built finds its end user. On the contrary, in developed markets with a larger offer, market analysis always represents the first and most important element in the evaluation of real estate investments, that is, it forms the basis for every calculation and decision. This is precisely why thorough market research and understanding is key to making good decisions at the right time.

The analysis process itself contains several basic parts, each of which provides the most important information needed to assess the feasibility of any real estate investment. A clear definition of the segment and a detailed analysis of supply and demand are the first step of any analysis. Based on the available supply and demand, price monitoring and rent movements, but also looking at other trends, we draw conclusions about the needs of the market in order to define the potential target group of buyers or tenants and their expectations. An important part of any analysis is the analysis of economic parameters, as well as demographic trends, because although real estate is tied to a specific location, it cannot be viewed outside the context of economic movements and trends in the country and the surrounding area. The analysis we perform at CBS International are based on the market data we have, bearing in mind that the company has been providing services in the mediation and sale of all types of real estate for more than 15 years in the market of Serbia and the region.

The goal of market research and strategic consulting is to help the investor create a product that is easily sustainable on the market, that is, to reach the projected income that he planned in the easiest way. The good news is that evidently all market segments in Serbia are currently developing, because we have been in the expansion phase for some time. When it comes to the construction of business premises, we have a great demand, and the lack of modern office space that meets the standards of international companies is one of the reasons why many investors are currently working on expanding their existing business complexes, and new business facilities are being built as well. Also, with the intensively growing housing market, good planning and analysis are becoming increasingly important, in order to build a project that is fully adapted to the needs of the market, that is, to a specific location in terms of the structure of the apartments, the quality of the finishing works, the price and the available contents in accordance with expectations of the target group of customers.

There are many reasons to do this type of analysis, and some of the reasons may be:

• – To decide whether to invest in one real estate segment or another, depending on the location of your plot and other offers
• – To find out everything about competing projects, demand and sales process in the selected part of the city, as well as what are the expectations of the target group of buyers
• – To check whether the rent you are paying corresponds to the amount of rent for that location, regardless of whether it is office space in Belgrade, Novi Sad or a retail network and premises throughout Serbia
• – In case you have a plot outside of ​​the city, to decide whether it is better to build a retail park with a clearly defined mix of tenants in accordance with the plans of retail chains or a logistics center, because this segment of the market is the least developed, and the need for higher quality space is increasing

Making a decision to build an office or residential complex, shopping center, retail park, logistics complex or hotel without a detailed market analysis is an unnecessary risk and can be an extremely expensive mistake or an excellent investment move. With the arrival of international investors in our country, the real estate market research segment gained importance. All research and investor advice is done in cooperation with our brokers and appraisers. In order to give investors information on where is best to invest in and whether they have chosen the right moment to invest, we first need to analyze the idea of ​​the project itself, as well as the location where it would be located. Not every moment is right, nor every project can bring profitability, and therefore a detailed analysis becomes very important in the planning process.