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What one discipline influences the course of all others? Population demographics. From business to healthcare, from education to style, from sports to the stock market, factors such as gender, income, ethnicity, age, mobility, employment and other demographic information determine the shape of our society.



Real estate is no less affected by the ebbs and flows of demographic trends, particularly income, aging, family situations and employment. Consider a residential real estate broker, whose success rests on the economic mobility of the population, as well as the economic health of the region.



"I look to see how fast the economy is growing in each of my markets, and desirable that location is looking to outsiders," says Glen Young of Sunseaker Investment Properties.



Land development planning depends even more on population trends to determine priorities. The average age of the population is a major factor in the type of housing that will be required over the next couple decades.



"A young population in an area will require more single family homes with multiple bedrooms and plenty of space for children to run," adds Wendy Cobrda, a specialist on US population demographics. "On the other hand, an aging population will need more hospitals, more medical clinics, more housing that requires minimal maintenance."



For land investors and real estate, the stakes are just as high. Investing in commercial real estate, for example requires the ability to forecast where there will be a growing population, and/or where the population's average income will be increasing.



In fact, commercial property investment requires a deeper understanding of demographic data; it is not just the population trends that need to be considered, but the demographics of the competition. Even those cannot follow a set formula.



An entrepreneur looking to set up a new car dealership needs to consider where established dealerships are located and set up shop nearby. Car buyers wanting to compare similar models need to visit several dealerships, so they need to be close to one another.



On the other hand, an entrepreneur looking to set up a new hardware store, should look for an area underserved by the competition or where new residential developments will be opening up. Hardware shoppers can compare brands of similar tools within the same store, so ease of access takes on a greater importance.



Traffic patterns can also make a difference, especially near busy intersections. The demographics of traffic can add to the complexity of making a commercial real estate investment.



Understanding where to invest in retail properties is one of the main reasons that demographic mapping is such a popular service, Wendy Cobrda explains. "To visually see the movement of people and their spending dollars helps businesses 'see' where they should open their next store."



Demographics also play a role in vacation rental real estate, too. "Do you buy vacation rental properties, or do you sell the ones you have now?" asks Steve Curtis, owner of a listing website for Florida vacation properties. "Well, that depends on how much disposable income people have for vacations and, more importantly, on the age of the population. A younger person is more likely to backpack through Europe, and stay at a hostel. An older person in more interested in comfort and privacy, which is what vacation rental properties offer."



It also depends on where populations are growing more, as well as where the affluence is growing. If an economic boom is happening in England and France, but not in the USA and Canada, a vacation rental in Spain might prove more useful than on the Gulf Coast of Texas.



"Business planning is just a shot in the dark without solid market data," explains Ms. Cobrda. "Demographic data reports and maps help businesses project market activity into the future, helping to avoid such catastrophes as building stores with no customers or storing a few million dollars of inventory that nobody wants."



Given the high ticket price of real estate properties, whether residential, commercial or vacation-related, demographic reports and market segmentation data are even more important.

About the Author: David Leonhardt is a freelance SEO-writer and consultant who also runs a freelance ghost writers service.