Question:
How do I pinpoint the hottest zip codes in cities that have the strongest Master Scores?
Answer:
First, recognize the limits of "momentum" (trends) — it's only part of the equation. The short answer: don't drill down to the ZIP level until you've evaluated and chosen a strong market at the Metro level.
Why start at the metro level? Because ZIP "micro-markets" follow what's happening in the overall city-level market. Many investors think a hot micro-market in an otherwise flat or declining market is fine — it isn't. The ZIP will eventually equalize with its parent metro (a rising tide lifts all boats, and vice versa). So pick the best metro first, then find the ZIP 'micro-markets' that outperform others on a relative basis within that same market.
Keep in mind it's exponentially harder to score ZIP codes with S.T.A.R./T.A.P.S. because they aren't a "market" — small pockets, few transactions, and a small sample size that creates a lot of random noise.
On the new platform, here's the quickest way:
- In the Precision Market Tracker, rank markets by the Market Outlook Score in The Table and pick a strong metro.
- Switch the geography level to ZIP, and (optionally) shade by a 2-yr CAGR appreciation indicator to smooth micro-market noise.
- Filter the Map to your chosen state/metro and scan for the ZIP pockets that look relatively strong year after year.
For example, if Nashville, TN is hot overall, drill into its ZIPs — a couple of pockets near downtown that look relatively strong (warmer colors) year after year are where you'd start.
Don't over-worry about catching a market the instant it enters a Wealth Phase, or that it's a few years into the cycle — the S.T.A.R. indicators usually give long lead times before a cycle reverses. It's more a question of "what are your options?" — what other markets are near the top of your ranked list.