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Avi Gupta with SmartZip at the 2009 Inman Connect SF

By
Real Estate Agent with Metro Brokers Realty Oasis

Mark Eibner: This is Mark Eibner with Broker IPTV, we are at Inman Connect in San Francisco 2009 and I am with Avi Gupta and Avi Gupta is with SmartZip. And welcome to the show Avi.

Avi Gupta: Thank you very much.

Mark Eibner: So tell me about your product, we were talking a little bit before, what's the difference between SmartZip and Zillow and cyberhomes and are you just another one of those?

Avi Gupta: Not really, so if you put it in ten seconds what we are really is the morning star rating for properties for residential real estate. So we have come up with an analytics and quantitative based approach where you can go and type in any home address and find out what its really worth for the long run, be it a home for... you know to live in or as an investment property.

Mark Eibner: So you use it more sophisticated analytics?

Avi Gupta: Exactly what we do is we look at historical data, going back 20 plus years and we try and correlate home prices historically speaking to all the other factors that might influence home prices and these are things like demographics you know income levels, population, trends, job trends, schools ratings you know crime, safety, lifestyle we have over, and over a thousand different data points that we analyze and figure out which ones really impact home prices and how, based on vary you know sort of minute property level information, we look at macro data, micro data and property data and then correlate that to home prices, and then we use that as a yard stick to say okay which homes and which markets might likely out perform other homes you know in the neighborhood.

Mark Eibner: So what's your count on total addresses as far as in the US [Inaudible], what's in your database right now?

Avi Gupta: Okay so what we do we have just launched a beta public site about a month and half ago in June and today we cover California and Florida and we have scored and rated almost 15 million properties across these two states. So beta listing or not we have rated it, so you can go to the site, you find a home that you know it maybe your home or it might be a listing you might have found somewhere else, you can type in the address and you will be able to get a writing, the SmartZip score as well as analyze that home you know code for cash front ROI, so if you are going to rent it out what's my expected cash flow, what's my expected ROI in 5, 10 or 15 years?

Mark Eibner: So you also have some tools then for investors?

Avi Gupta: Correct, we have tools which basically help investors analyze rental income, expected maintenance you know expected vacancy rates and these are analytics that we have built using you know data sources and then we help investors figure out you know what they can expect in terms of cash flow ROI and then shortly there after we will have other analytics like cap rates and you know cash and cash return and a few other things.

Mark Eibner: So how long do your auto beta move into the other states in the United States?

Avi Gupta: The plan at least as we speak today is to do a national role out sometimes in Q1 of next year.

Mark Eibner: Interesting. Well great information and the site for that again is what?

Avi Gupta: Its www.smartzip.com.

Mark Eibner: Super we will [Inaudible] and good seeing you here at Inman.

Avi Gupta: Thank you very much for the opportunity.

Mark Eibner: You bet.

Comments(2)

Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

Trying to "predict" home pricing is like trying to corale cats -- it's kinda hard to do.  Pricing is SO subjective.  And whatever numbers are being "crunched" are general statistics.    And what if the ROI is not as you predicted, and we invested based on your wunder program.  And we lost a ton 'o money 'cause your wunder site didn't predict . . . oh a natural disaster, a catastorphic event, a political something or the other, invasions of body snatchers -- and the market TANKED, right when the forecast said we'd reap. Can we sue you?

Aug 28, 2009 03:51 AM
Anonymous
Eric Schwager

Tools are tools, and their value comes from how you use them, not what they are per se. It seems to me that the greatest value in SmartZip is the ability to compare long-term outlooks among properties, neighborhoods etc.  I know that if one slot machine gave me a 20% chance of winning and another one gave me a 40% chance of winning, I would go with the latter, knowing that the 40% slot machine wasn't guaranteeing anything either except better odds. (This may be a bad analogy -  I don't mean to compare real estate investing to gambling, but rather highlight the value of relative ratings).

Statistics are by definition backward looking, and you're right, past housing statistics won't help you predict future earthquakes or wars, but still, the more predictive power you can get from your historical data, the better. 

The true test is to see how significantly the SmartZip ratings correllate to how things actually turn out, which is by definition dicey because these are long-term predictions.

One of the funniest and most insightful things I heard somebody say once was from a guy that specialized in forecasting: If you give a number, don't give a date; if you give a date, don't give a number; and if by pure luck you happen to get it right, don't act surprised. :-) 

 

Aug 28, 2009 09:10 AM
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