What You Need To Know Before Trusting Real Estate Advice On TikTok
Can you scroll your way to real estate success? The answer is a bit more complicated than a yes or no. Originally, TikTok started as a platform for fun dances between friends. But as its popularity grew, it has since expanded its reach, content, and users to ... pretty much everything. So what is there to be taken away from this social media juggernaut as it pertains to your real estate journey? After all, there is no way that information shared in 154 countries to 1.5 billion monthly users can be taken at face value (according to Demand Sage).
Like anything else on TikTok, context is key here. The app particularly specializes in trends, and real estate trends pertaining to design and architecture might offer value for helping you pull optimal value out of your property. That said, it is important to differentiate the hard knowledge that can be learned from a platform like TikTok versus topics that require a bit more nuance.
Breaking down the market
When it comes to TikTok content relating to the condition of the market, you should proceed with caution. First and foremost, the real estate market is at a unique point. As we are coming out of the hottest seller's market in 40 years, content creators have a multitude of reasons to push their respective opinions about the future of the market. Some prolific real estate TikTok personalities talk about markets they are expecting to "crash" in the coming months. "Crash" is an example of a splashy word that gets views, but is rarely defined within content as short as a TikTok video.
Additionally, a lot of these personalities specialize in buyer-centric business strategies and offer paid courses that they advertise on their pages. It is in the interest of these personalities to say that the real estate market is heading toward a buyer's market as it incentivizes their viewership to invest in their products and services. Sensationalizing aside, Norada Real Estate Investments notes that more than 50% of real estate professionals believe that the housing market will not crash. Furthermore, leading industry expert Realtor.com states that millennial home buying demand remains incredibly strong, lending practices are much stricter than in 2008, and there is still an overall shortage of inventory. While both TikTok and the real estate industry may have their narratives, ultimately, the best advice will come from speaking to your local market realtor.
Investing strategies
Real estate investing has become a popular topic on TikTok, with realtors and investors, alike, democratizing many of their strategies toward buying property and building wealth. Many of these creators offer valuable insights as well as digestible delivery methods on how to get started in real estate investing. That said, it is important to understand that this kind of information is also not to be taken at face value.
Flipping houses is another popular discussion on TikTok. For example, a creator might state that a great way to make money in real estate is to buy a distressed home for a certain amount, pay for renovation costs, rent it out, receive a local appraisal, and then take the difference of that new appraisal payment and walk away with a profit. This might sound inherently simple, but the same creator will often leave out details such as down payment, closing costs, repair details, and the loan-to-value ratio, which makes transactions like this more complicated (as noted by Fit Small Business).