Is this area growing or declining?
When it comes to recognizing trends in the market, real estate agents are on the front lines. They see a lot of growth and decline -- some areas can turn from a swamp into a bustling residential area in just a few years, while others can transform from a highly desired neighborhood into foreclosure city in no time. As your window into the real estate world, your agent should be aware of what the growth and decline trends are, and help you find an area that has a positive outlook.
It's easy for most people to see that the neighborhood with lots of boarded up homes might not be growing, but often the signs are much more subtle, especially in the early stages, and your real estate agent can spot the clues. Things like neighborhood activity, street maintenance and the type and number of small businesses in the area can all point to the neighborhood's growth trends. A good real estate agent will be able to tell you if the home you have your eye on is likely to be a good investment based on everything else that's happening around it.
Your real estate agent should be intimately familiar with the neighborhoods in your area -- it's his job, after all, to know the territory well. This type of knowledge often comes through experience, and sometimes agents even work together to share knowledge and expertise. The next question will help you determine whom exactly you'll be working with.