Finding data is easy. Yet, finding accurate data that leads to actionable insights is still a challenge for most businesses, especially when it comes to home valuation, used across the property industry.
An individual, such as a first-time home buyer or a real estate enthusiast, looking to learn more about the value of a home, has lots of resources to consult. She can call up a friend who just sold a home in the area to get the scoop on the market, or conduct a quick search on Zillow and pull up their Zestimate for a property of interest. She can even search for 10 similar homes and compare AVMs in a google spreadsheet against some less algorithmic data points, like the neighborhood or its distance from the closest Whole Foods.
But for a business, this approach hardly represents the big picture – more a sad, statistically insignificant sample size. What many real estate businesses need is to see the value of all available properties for an entire region.
This process is still less than straight forward even with the birth of new technologies and lots of money continuing to pour into them - Compass’s latest investment round of $370M makes a great example, “In our conversations with developers and investors, we often hear frustration with the disconnect between the availability of data and the difficulty of harnessing it for quick, actionable insights,” according to McKinsey Consulting.
There are a few ways businesses can approach this challenge. If you’re one of them, keep reading! We’ve listed them from the least to the most hands-on involvement.
Get some help
RE/MAX just launched their latest in-house-developed all-encompassing realtor platform called ‘booj.’ We guess it’s taken them the better part of a year after acquiring an outside web design and development company to focus strictly on the work, but you better believe they’re serving up comparable insights with property data for brokers and agents to use in real time.
booj platform preview
Not every business has this capacity, however – and doesn’t have to. There are lots of platforms out there that integrate with the data you need to provide these insights served up on a silver platter. You pay for the service, but it could avoid a lot of headache.
No matter which real estate sub-industry is your specialty, you can find a platform that will help you organize insights and take action on them. Service Titan is a great example that might be able to help service businesses send more experienced technicians for higher value homes or Flexmls could help brokers and agents prioritize leads based on home value. Check which platforms you’re interested in offer home valuation as part of the package.
Customize existing platforms by adding pre-calculated valuations
If you already have a highly functioning database or listing service that you can work with, think about pulling in some extra data to make it even better. This approach would get you similar benefits of option #1, but you don’t have to start from scratch and you gain some more control over costs. Platforms will always offer more features than you’ll use and they inherently have constraints on how the data can be filtered and used.
Integrating a pre-calculated valuation can easily be done with a property data API so that it’s displayed in context with the property or property grouping and its other data.
Another approach is to get a custom bulk list of properties that can provide you with AVM. One advantage here is that no integration is needed and you set the limits on the data you’re interested in seeing. If you only need a single county-wide view of property AVMs, that’s what you pay for.
For some more experienced professionals, being able to manipulate a large dataset could be exactly how their brain works, especially when looking for insights across specific geographies and bulk data provides just that.
Create your own internal valuation model
This approach is not for the faint of heart, but if you’re curious and educated in statistical analysis, it’s certainly an option.
AVMs differ based on the method used, such as the hit rate. If the hit rate is too high, you’re property-level accuracy will suffer.
Estated’s bulk property data set is that it is built for analysis. You have unlimited access to raw data and a pre-calculated AVM to help you establish a benchmark to work against. If you’re in the business of knowing your stuff, a pre-calculated AVM might miss the nuances you would otherwise catch. You could adjust your method based on regionality. Your AVM could have a higher standard deviation for your markets in southern Connecticut than they do in the tri-state area, for example.
With both a property data API and a bulk data set, you get home valuation along with all the other data you could possibly need at your fingertips to take action. Homeownership and addresses can be used for lead generation plus ~ 100 other data fields to consult in a deep dive analysis on any promising properties.
Whether your business and its people are data-savvy, data-driven or both, we hope one of these three options will help you use home valuation to better inform your business.