Real time housing data is significantly more valuable than months old NAR data
Posted by Pat Kitano at 9/27/2006 7:38 PM 
Categories: Technology, New Business Models, Realty Realities, Real Estate Economics, Cool Web Tools, The Future
Categories: Technology, New Business Models, Realty Realities, Real Estate Economics, Cool Web Tools, The Future
(Good news, bad news... it's all old news in the internet era!)Only two days after hearing about the NAR report of the first drop in home prices in 11 years, I hear on the radio that sales of new homes in the U.S. unexpectedly increased 4.1% in August. If you're a Realtor looking for supporting data to show your potential home buyer that now is a good time to buy, these two pieces of conflicting data only serve to confuse your client even more. Furthermore, all the reported housing data from NAR and other government and state agencies are analyses of statistics from recorders' offices and are therefore at least a month old. Real time data is critical to confirming what Realtors see in the trenches and the hunches they have about their local markets.
I found out about Altos Research a month ago while analyzing Google's statistical offerings. Simply put, Altos works with current MLS listing data to monitor very localized housing markets down to small towns (only in the Bay Area and Seattle now). The data is fresh because Altos doesn't "wait" for the data to hit the recorder's offices. For Realtors, the local analysis allows them to make specific recommendations down to neighborhoods (although I wish Altos can segment San Francisco data into its neighborhoods... hint).The methodology is markedly different from the Zillows and other statistically oriented home valuation models that use historical data.
Here's an example - a week ago, Kevin Boer hears anecdotal evidence of some kind of market upturn in Palo Alto, and I see more escrows opening from existing Bay Area clients in my escrow business throughout the month. Yet, the media was consistently gloomy about the housing economy all September as it processed the 1-2 month old data massaged by the NAR, all while loan rates and oil prices were skidding. Here's Altos' take on Palo Alto - the upturn is evident... Obviously, the interpretation of the data is based on the perspective of the data user, but in the face of all that gloomy news, an uptick stands out. (I flash on how Wall Street technical analysts like to chart and wonder if there is applicability to housing data... fyi, I never took technical analysis very seriously).
I was talking with a Realtor last week who said she was telling her clients that they should buy now because mortgage rates will climb...(this is why old news is dangerous, especially when it gets hardwired into certain brains). I had to reply (kindly) what she should say is the Fed is now projecting to cut rates soon, and as rates fall further, buyers will return and make purchasing a house more competitive than it is now. So that's why her clients should buy... after checking the Altos graph for their neighborhood.
Technorati tags housing data altos research Kevin Boer real estate technology housing market
Pat,
On my blog I posed the national numbers, and I have been posting the interest rates and commenting that they have been going down. I also do what no other blogger is doing, I post market activity by neighborhood. People really only care about what is going on in their own area. When the traditional media reports I notice they are behind the times. I am in the business eery day and know what is going on long before they do. Our office receptionist has a much better feel for the local market than the "experts" do.
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Hi Teresa,
Realtors like you, especially because you distribute vital market information via your blog, are always in real time mode. You're a bellwether. It's the reason why our type of journalism is way more topical and relevant than the media reports and the associated herd mentality that follows it. It's our objective to educate those around us on how to see through the chaff. The impetus for my post stemmed from my conversation last week with the Realtor who had conditioned herself over the past year to the media-reported inflation rate increases, but needed to adjust to real time to be relevant to her clients.
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I am moving from Wayzata (Minneapolis) MN to Whitefish MT. I am developing a RET real estate blog and want Altos Market Data. Because I'm in MT, Altos does not feel I am cost effective for them. Who else would you recommend that has a product similar to Altos? Both myself and Jim Cronin @ RealEstateTomato have asked them if they will enter the MT market. I think this information is absolutely critical. I am leaving a market where I have incredible market data from my Minneapolis Area Association of Realtors. I won't have that with the Northwest MLS I will belong to. Thanks for any help you can send me. Cynthia
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