A market analysis is very important to the success of any development. Initially, the developer can obtain market information for a first blush impression. It is in the best interests of a developer to obtain a third-party market information and analysis before making any decisions regarding a potential development. A lender will more than likely require a third-party market study before any loan is approved. Lenders have their own requirements for market studies and they should be checked before any market analysis is started.

A third-party market analysis firm obtains more specific information regarding size of market, completes a supply and demand analysis, can recommend unit mix and amenities, reports on linkages with the community, and reviews and comments on other important market facts. This market analysis should give enough information so that a decision can be made on whether and how to proceed with any plans.

For WHEDA financing, see WHEDA Market Study Guidelines and approved market study providers. The Market Study Guidelines Appendix addresses specific issues related to Market Considerations for Residential Care Apartment Complexes (RCACs).