All Forum Posts by: Steven S.

I built out a Zillow iframe of comps into my app's Sales Comps feature after being inspired by your site's 'Listings' tab! I didn't realize Zillow allows iframes, RedFin doesn't, but it's nice to have:

 Thank you! Yes I built this myself. You can use it for free, go to app.runcomps.org and enter your_best_friend

This only has Los Angeles/Ventura data (since that's where I work), but something similar could be built out if you have access to transaction-level data for your market

Quote from @Ned J.:

Quote from @Terri P.:

Quote from @Ned J.:

Exactly like Nathan stated.... if they pay for it and its properly installed by a trained professional and they pay to maintain it..and its stays.... no problem

Hi Ned! That’s where I’m hesitant about the simple ask because they will likely install this themselves so no receipts. Per my request they sent me a YouTube video (see above) where it’s placing a bracket to hold the filter and disconnecting the cold water faucet hose from the shutoff valve, then installing a water supply line adapter to the cold water faucet hose. Seems simple until something goes wrong.

 Then the answer is a hard NO.... DO NOT let tenant do their owner work, especially when it comes to water lines etc. 

They either have a professional do it....and one that YOU approve before..... not Joe Blow Handyman that you have no clue about..., or its a NO GO... PERIOD.

Wouldn't the owner then take on the liability? Let's say it leaks for days before detection, lots of water damage to kitchen cabinetry/floors, and it's determined the new water filter system was the culprit.

Now the owner is trying to collect to remedy damages. The tenant is going to say 'That's not my fault, this guy you approved installed it'. Then the contractor who did the install will say 'That's not my fault, they broke one of the lines' or 'it's a POS system from Amazon what did you expect, call the manufacturer', or 'I just installed it, I didn't warranty it', etc (especially if the tenant bought it and the contractor is just installing it)

My thinking is if the owner approves/recommends the contractor to do the work, it's then their responsibility to make sure it's done right, and their liability thereafter because it's their property after all. Ever provided a fridge/washer/dryer? Same story there, if you provide/install it, it's yours to maintain & keep running.

Whereas if the owner stays out of the installation process entirely, it's clear as day who is liable for the damages (if any arise from this water filter)?

Quote from @Terri P.:

Quote from @Ned J.:

Exactly like Nathan stated.... if they pay for it and its properly installed by a trained professional and they pay to maintain it..and its stays.... no problem

Hi Ned! That’s where I’m hesitant about the simple ask because they will likely install this themselves so no receipts. Per my request they sent me a YouTube video (see above) where it’s placing a bracket to hold the filter and disconnecting the cold water faucet hose from the shutoff valve, then installing a water supply line adapter to the cold water faucet hose. Seems simple until something goes wrong.

I installed one of these myself, it does require drilling a small hole in the return/waste pipe under the sink (since reverse osmosis has waste water to eject from the system).

When they move-out, make sure to inspect the pipes under the sink for any holes. If they remove the filter upon move-out, either you or them need to patch that hole before the next tenant moves in. Better yet, tell them to leave it all setup under the sink and keep it for the next tenant! Everyone appreciates filtered water

If you are just looking for your next project to buy, I agree with Bob. If you want to build a tool to help you identify opportunity faster, you have to basically take those manual underwriting skills and codify them somehow.

My program's approach is basically my manual approach, it just doesn't have any photos/videos to work with. Thankfully, in an active market like the SFV & West-LA, there are so many transactions of high & low end property that you actually don't need photos/videos, the market values it as it should be upon sale, and my program simply reverses that logic.

If you want to learn exactly how I extract the comps from the larger dataset and calculate the ARV/ACV values based on that comp data, checkout my older post here & go through the comments: https://www.biggerpockets.com/forums/48/topics/1130680-i-mad...
-This should give you a great idea of how to implement some logic to analyze your own transaction-level data. 

It is accurate, because the market is reliable at valuing homes on a $/sf basis. Here's another recently closed, renovated home run through my program with the query "19707 Corbin Ln, Winnetka, CA 91306 5/4/2350-3000,0.65,255":

2-4 good, recent comps are all you need to properly estimate the ARV of your project, definitely not 20-30.

Here's how I manually underwrite a flip if the numbers look promising (note the number of comps used, the $/sf avg of the comps, the $/sf avg of the green 'High' percentile graph, and the resulting $/sf of my estimated Sale Price):

Quote from @Carlos Ptriawan:

Quote from @Steven S.:

Carlos, I see you took a group of comp data and passed it to Ai. If you wanted to repeatedly do this, and your source data is available/downloadable, why wouldn't you just make a spreadsheet or program that would take this list of comps you provided and calculate everything you want from the real source data? Why pass it to an Ai for a half-baked summary when everything it told you (Median & Avg data only) is available on RedFin, with real data, for free? See this https://public.tableau.com/shared/W5RZNC9GC?:display_count=n...

I'm not sure what comps/data you uploaded (looked like all 95111, but the Ai analysis seems wrong/blended). You asked about the 95111 Zip Code, but the $/sf values it gave you seem to be a blend of San Jose itself AND the 95111 Zip Code. The 95111 Zip Code doesn't have a Median $/sf of anything over $750/sf, but the Ai analysis says it does!

And David, I'm impressed a query on Cohere could pull viable sales comps, impressive! However you get the sales comps data, that's great. Get all the data you can, and build some analysis tools that will help you make quick decisions. I wouldn't leave any interpretation to an Ai, these are your dollars you are spending after all!

If you guys are seriously considering Ai for Sales Comps Analysis/Market Analysis/etc, you are using Ai wrong and are either just unaware or cognitively dissonant of the pitfalls. I mean Carlos, you and I have talked about seasonality affecting prices in a repeatable way (buy in Winter, sell in Spring/Summer for ~10% gains), do you see any such consideration from the Ai in it's pricing predictions below?:

- No, just pure linear growth of +$25/mo applied to the wrong $/sf (95111 is ~$700/sf currently, not $900/sf+). 

I'm wondering how much you both have actually used Ai to accomplish something that's measurable (like coding projects for example, if they don't run right, you have instant measurable feedback). I've used it on lots of software projects across varying complexity levels, and while yes it will be able to make a simple program or identify an obvious issue, it just can't do anything of real complexity. To non-technical people (no coding ability), it's mind-blowing and magical to get a game of snake coded up for you, or similar toy program.

To me, someone who tries to use it constantly, I am continuously disappointed. It will remove parts of the code that were essential, it will import non-existent libraries and call non-existent functions, and just generally confidently hallucinate something that sounds like it should work. I can recognize this because I actually try and put the code it outputs to use, then I see these disappointing things, and re-evaluate my trust/confidence in these Ai models. Same applies to your Ai market recommendations, except you would have bought a home thinking the resale is $900/sf+ when in reality in 95111 the median is $700/sf at best. You just never know what the heck this thing is doing, until you put it to the test.

 Steven we know we can always tune in that aspect to make it better. I have been using this predictive modelling even before AI exist just solely using Zillow ZHVI. I am agile enough to expect AI can be better. 

I ask again to the AI whether they see pattern:


Based on this excel sheet, what is seasonality pattern that you see ?

Based on the provided real estate data for San Jose, CA 95111, there appears to be a seasonal pattern in home sales activity and prices:

Peak Season (Spring/Summer)

• The data shows a higher number of home sales occurring in the spring and summer months, particularly from March through August.
• Home prices also tend to be higher during this peak selling season, likely due to increased buyer demand.

Off-Peak Season (Fall/Winter)

• There are noticeably fewer home sales recorded in the fall and winter months, from around September through February.
• Home prices also tend to be somewhat lower during this off-peak period compared to the spring/summer months.

This seasonal pattern is quite common in real estate markets, driven by factors such as:

• Warmer weather and longer days make it more convenient for buyers to go house hunting in spring/summer.
• Many families prefer to move during the summer when children are out of school.
• The spring market is fueled by annual bonuses/tax refunds providing down payment funds.
• Sellers often list their homes in spring to take advantage of the higher buyer demand.

However, it's important to note that this is just a general observed trend. There can be significant variations year-to-year and exceptions to the pattern based on local market conditions, economic factors, interest rates, inventory levels, and other variables

I am just saying at the end of the day, the small data set of statistic modelling for real estate would be entirely change to AI even now and future as we don't even need to code anymore. This is just global trend. Like Peter question or Dave question, if you want to find potential 2 standard deviation purchase, buy single family that's double than the DOM of the market and make a visit. Been using 'manual' predictive models just by following ZHVI alone and Redfin sold data in excels.

You spoke only to the seasonality (or previous lack thereof), and not the incorrect $/sf metrics which it confidently hallucinated. Of course when you specifically ask 'what seasonality pattern do you see' it will try and detect the pattern, but that's a part of my point. It will feed you BS for any complex analysis/task, and the more specific you are, the more specific and convincing the BS is (this is EXACTLY what I run into on Medium-High complexity code projects).

If it truly understood this seasonality pattern, it would have applied it to the previous uninstructed $/sf estimate for the future. The fact it didn't, and only applies this reasoning when prompted, proves it's not as intelligent as you seem to think. Even after I specifically explain a complex loop in my code, and exactly what should be refactored/adjusted, it is unable to assist. I mean, it will happily assist, but the amount of hallucinations and incorrect code it writes compels me to state it is unable to assist.

If you write up a prompt with a bunch of specific instructions, trying to guide the Ai to weigh everything of consideration, it will surely sound more convincing than if you didn't include those stipulations, but the underlying problem is it has no real understanding of such a complex task and will just give it's best guess/hallucination regardless of how specific you are (as proven by your 95111 zipcode $/sf prompt where it provided you a $/sf much higher than that of the actual 95111 zipcode). This was a basic task of calculating the avg $/sf of closed sales in the 95111 zipcode, and it completely failed, so what makes you think specifying more details will make it more accurate? The underlying architecture of these models makes them best for chatbots & translators (matching word meanings/uses across various languages and translating based on positional/usage probability).

I understand in 10 years there might be an Ai that can do this, but right now, these tools are useless for achieving anything of substantial complexity (meaning anything from medium-large coding projects to properly valuing a home, or even calculating the proper $/sf avg in a zipcode), so I don't understand why you repeatedly advocate for their efficacy in this REI space?

Carlos, I see you took a group of comp data and passed it to Ai. If you wanted to repeatedly do this, and your source data is available/downloadable, why wouldn't you just make a spreadsheet or program that would take this list of comps you provided and calculate everything you want from the real source data? Why pass it to an Ai for a half-baked summary when everything it told you (Median & Avg data only) is available on RedFin, with real data, for free? See this https://public.tableau.com/shared/W5RZNC9GC?:display_count=n...

I'm not sure what comps/data you uploaded (looked like all 95111, but the Ai analysis seems wrong/blended). You asked about the 95111 Zip Code, but the $/sf values it gave you seem to be a blend of San Jose itself AND the 95111 Zip Code. The 95111 Zip Code doesn't have a Median $/sf of anything over $750/sf, but the Ai analysis says it does!

And David, I'm impressed a query on Cohere could pull viable sales comps, impressive! However you get the sales comps data, that's great. Get all the data you can, and build some analysis tools that will help you make quick decisions. I wouldn't leave any interpretation to an Ai, these are your dollars you are spending after all!

If you guys are seriously considering Ai for Sales Comps Analysis/Market Analysis/etc, you are using Ai wrong and are either just unaware or cognitively dissonant of the pitfalls. I mean Carlos, you and I have talked about seasonality affecting prices in a repeatable way (buy in Winter, sell in Spring/Summer for ~10% gains), do you see any such consideration from the Ai in it's pricing predictions below?:

- No, just pure linear growth of +$25/mo applied to the wrong $/sf (95111 is ~$700/sf currently, not $900/sf+). 

I'm wondering how much you both have actually used Ai to accomplish something that's measurable (like coding projects for example, if they don't run right, you have instant measurable feedback). I've used it on lots of software projects across varying complexity levels, and while yes it will be able to make a simple program or identify an obvious issue, it just can't do anything of real complexity. To non-technical people (no coding ability), it's mind-blowing and magical to get a game of snake coded up for you, or similar toy program.

To me, someone who tries to use it constantly, I am continuously disappointed. It will remove parts of the code that were essential, it will import non-existent libraries and call non-existent functions, and just generally confidently hallucinate something that sounds like it should work. I can recognize this because I actually try and put the code it outputs to use, then I see these disappointing things, and re-evaluate my trust/confidence in these Ai models. Same applies to your Ai market recommendations, except you would have bought a home thinking the resale is $900/sf+ when in reality in 95111 the median is $700/sf at best. You just never know what the heck this thing is doing, until you put it to the test.

Quote from @David D.:

I'm not sure just regurgitating webpages is how it's doing that, but that's a topic for another thread I guess!

No need to guess, I proved it beyond a reasonable doubt on my Page 1 reply (Chat GPT4's estimate on the ARV is exactly what RedFin's site has):

If your main goal is identifying lower-than-market value properties (for example you see a newly listed SFR for $400k, your program sees as-is value should be $500k, and renovated value should be $650k, so you get notified), you need to build out sales comping functions/algorithms and make sure those work reliably. Sounds like you are in the process of doing this now. Then just take that polished-sales comps function, and run every new listing in your area through it, and you get what I called the Daily Spread Analyzer in my Page 1 reply.

As for how to do CMA/Comps, it's as easy as pulling up the neighborhood on RedFin (ideally 0.25-0.75mi max), adding filters to match similar BR/BTH/SF Ranges, and then sort by Highest Price to Lowest Price. This will give you the highest-quality renovated comps at the top, and as you scroll down you will get to the worst condition/fixer homes. Just flip through the photos of each, get an idea of what the renovated comps are selling for, and that's where you will end up once renovated. Without visually inspecting the sold comps via photos, you can segregate the renovated from distressed by chunking the $/sf of the resulting comps by quantile groupings. So long as there are constant sales of renovated properties in your market, this will be accurate.

If you take another look at this, you can see after I enter the query I get back the ARV, ACV (As-is Cash Value), and all the comps from high to low:

You can tell the highest comps are close to $2M with $700-850/sf, the lowest are $1.3M at $500-600/sf. My program takes those comps, performs some additional grouping/averaging, and estimates the ARV & ACV. Then those ARV & ACV values are the basis of determining if a new listing is over or under priced.

Are you working with actual transaction-level data in your market, where each row is a transaction with columns like Address, Lat, Lon, Close Price, DOM, Listing Description, etc? Or is the root of your data averages/medians that are provided from housing data providers like RedFin?

Quote from @Amir Fekrazad:

Hello, real estate people!

I have created a comprehensive neighborhood research tool, Maptimum, that I think you will find very useful, whether you're a homebuyer or investor.

You enter an address, neighborhood name, or zip code, and specify a radius or shape around it. The website then compiles a report including all the details you might need to evaluate the area.

Please give it a try and let me know what you think. The first report is free after you sign up.

Each report includes the following:

1. The People
   1. Population
   2. Household Composition
   3. Age Groups
   4. Racial/Ethnic Composition
   5. Education
   6. Income Distribution
2. Living Environment
   1. Occupancy Rates
   2. Nearby Low-Income Housing
   3. Land Cover
3. Safety and Security
   1. Crime Indexes
   2. Fatal Car Accidents and DUIs
   3. Sex Offender Registry
4. Schools
   1. Public School Districts
   2. Charter, Magnet, and Private Schools
5. Health and Natural Risks
   1. Air Quality
   2. Noise Pollution
   3. Earthquake Risk
   4. Flood Risk
6. Lifestyle
   1. Walkability and Bikeability
   2. Public Transportation Access
   3. Dating and Marriage Outlook
   4. Pet Ownership
7. Politics and Social Climate
   1. Voting Patterns
   2. Political and Social Ideologies
8. Investment Insights
   1. Value Appreciation Forecast
   2. Rental Viability Analysis
9. Verdict
   1. Desirability and Bang for the Buck
   2. AI Insights

www.maptimum.com

I used it, really like the drawable boundary, but these are all demographics. There is nothing regarding Market Analysis, like Avg/Median $/sf, AVG DOM, Renovated $/sf vs Distressed $/sf Avgs in selected boundary, etc.

I see your site as a lesser version of datausa.io, here's their report on Woodland Hills: https://datausa.io/profile/geo/los-angeles-county-la-city-no...

After you checkout DataUSA.io, why would anyone use your site over theirs? They have been doing this for 10+ years now... I'm all about having your own data and making your own custom tools to calculate on that data, but when it comes to demographic data, you just aren't going to beat someone like DataUSA.io or SocialExplorer, they have teams of people building this stuff.

If this was just a cool project you did, kudos to you, great job! But if you thought this would be a viable product to sell (what it appears to be), you started coding way too early and should have done some competitive analysis to realize you want to build a lesser, paid version of an already free product...

And to top it all off, demographics aren't the holy grail you might think they are ("I think you will find very useful, whether you're a homebuyer or investor"). I'm a flipper & builder of 3-6unit rentals in LA/Ventura, I can tell you I have never once run demographics to determine feasibility. The price, rental/value upside, and other Market Analysis (not demographic) data is what we rely upon when making go/no-go decisions. If you were planning on building a 100+ unit Mixed-Use project, you would care a lot more about demographics since it'll be 2-3 years in planning/approval, and another few years until stabilization, but for 99% of people on this forum, they don't care what the median income or age is, they only care what they can buy the property for, and what it'll be worth renovated.

The more underwritings you do, the more you realize that all this demographic stuff is already priced-into the properties. For example, a high-crime zipcode of LA will have lower $/sf across the board, whereas a low-crime high-educational attainment zipcode will have higher $/sf. I didn't need to dig through demographic data to find this out, the market accounts for all these things for me already when I run Sales Comps. So just run sales comps (Market Analysis)! Why inundate yourself with all these meaningless demographic data points when the end result is they effect the prices/values, which you would have to run sales comps to accurately determine anyways?

Maybe I'm missing something, how has this tool helped you buy more/safer deals?

Quote from @Ugo O.:

Hey Steven, thanks a lot for the feedback, this makes a lot of sense. Deals 60-65% of the ARv are seemingly hard to find. But I guess we need to keep searching until you find a deal that works. Do you go direct-to-seller to find your deals or do you simply purchase from the MLS or wholesellers? What's your deal-finding process?

Also I am investing in the US so a lot of your tools help me as well, thank you!

Of course, happy to share. We use agents, no D2S deals. We let them rep us on the buy & resale once it's renovated/built, and they are happy to try and work with us on a deal where the seller wants an all-cash, quick close, or the home won't work for conventional lenders/end-buyers, etc.

It is hard to find 60-65% of ARV deals, but that's why we are still around! Lots of friends (owning competing businesses) had to go through Bankruptcy recently due to the small market shift that occurred, just bought at the peak and were too hopeful in the market continuing upward. If you can just make sure you are buying right, everything else falls into place eventually.

There are markets that perform better than others, but unless you are holding long-term or building rentals, you shouldn't really care too much since flipping is all about buying at the right price for that market: