Based on these listings in my neighborhood, it looks like I have over $125K in equity in my home. That’s a 55% increase on my investment in just 5 years. Amazing! The real estate bubble is no where to be found in Charlotte.
According to the S&P Home Price Indices, Charlotte is now the top city in the nation for growth in home values. Read the story here. This equity in my home keeps getting better and better!
I’m doing a few tests with video. Here’s a sample of our work.
Last summer, I was introduced to Karim Tahawi, the creator of my-currency. Karim comes from a markets background, and at the time was developing the infrastructure of his newly launched service. He explained to me his efforts to integrate a wisdom-of-the-crowds platform to home valuations. At the time I had a hard time trying to wrap my head around the idea. And to be honest, I still am.
Ok, so we have another socially interactive website centered around home prices (see Zillow). And yes, instead of relying on Zillow’s “black box” algorithm, you the people have the power to provide your input as to what value you actually place on the home. Sounds great, but useful? Will people really care? Which people will actually care? Do we really want anyone controlling the valuations of homes?
The way I see it, this my-currency prediction model is significanly flawed. We all know that something is only worth the value of what you can actually sell it for.
The real predictive, wisdom-of-the-crowds valuations of home prices are already being done when a prospective buyer submits an offer on a home which is for sale. Multiple offers are evaluated, one is ultimately chosen, and these offers resultingly dictate the actual market value of the home.
Receiving input from non-participatory parties in the sale transaction simply creates a value which is unusable and unrealistic. This would be the equivelant of asking your taxi cab driver of what value he places on your stocks and bonds. True, trustworthy values are created by those in the trading arena – not the bystandards.
So, with this being said, what are the possible applications for this model? Instead of opening this application to the entire world via the wide-open internet, what if this software was modular and was available at open-houses? Give a survey box to every person who walks through, and allow them to grade the home’s valuation as they are there in person. (Kitchen outdated? Minus $10,000. Breath-taking view? Add $20,000).
I’m sure there is a benefit for this type of modeling system within the home buying industry, but I’m sure making home valuations this wide open isn’t the sweet-spot.
We are getting closer to launching RealtyAgents.com. This an exciting venture for us. After speaking to many industry experts and lay-persons, it is clear that this network should fill a void in the agent community. I don’t want to give away too many things just yet, but it is safe to say the RealtyAgents.com will be a site built for the working real estate agent.
This snapshot should give you a few hints. Keep tuned for more updates.
In this 15 minute interview Pete Flint gives a candid summary of how Trulia was founded, how they came up with the term ‘Trulia’, their means of startup, the business model, and market outlooks.
Here are the notes that I jotted down as I listened to the interview.