Auction.com, Google Roll Out Near Real-Time Real Estate Report

Posted by Patrick Barnard on October 30, 2014 No Comments
Categories : Residential Mortgage

One of the challenges the real estate industry has always faced is getting key, relevant industry data in near real-time so as to accurately forecast changing market conditions.

Part of the problem is that the most frequently referenced real estate market reports are dependent on the completion of closings and delayed by the recording process. In other words, real estate professionals, investors and consumers have traditionally had to wait until key market data are collected, analyzed and packaged into reports.

To help meet this ‘need for speed,’ Auction.com and its search giant partner, Google, have introduced a new online service that provides real estate marketplace data in near real-time.

Dubbed ‘Nowcast,’ the new service combines industry data, proprietary company transactional data and publicly available Google Trends data to predict market trends as they are occurring.

Nowcast gives professionals working in the housing markets access to key industry data weeks before the findings of other benchmark studies are released, Auction.com claims in a press release.

Findings from the first Auction.com Nowcast reveal that existing-home sales in October will fall between seasonally adjusted averages of 4.967 million and 5.380 million annual sales, with a targeted prediction of 5.178 million.

‘Google Trends data – which is anonymized, publicly available search information – offers valuable insights into current economic and consumer trends,’ says Hal Varian, chief economist for Google and a developer of the new service, in a release. ‘By layering industry-specific transactional data and subject matter expertise over that search data, organizations such as Auction.com are able to create powerful predictive models for accurately forecasting buying behavior in the present and for the coming months.’

‘Auction.com's ability to deliver timely analysis of current market conditions can provide critical insight and enhanced predictability to industry professionals, economists and government entities alike,’ adds Rick Sharga, executive vice president for Auction.com. ‘[Because] real estate trends play such a vital role in our overall economy, there's a compelling need for accurate, more timely housing market forecasts, rather than data that comes out two to four weeks later.’

Auction.com plans to issue its monthly Nowcast near the middle of each month, once analysis can be completed on early data.

The new service combines economic, industry and proprietary transactional data with related online search term activity that indicates home-buying intent. Auction.com and Google report that they are currently layering in new features and functionality – for example, in the future, the service will be able to forecast existing-home sales, new home sales and home pricing trends for a given month, within that same month.

The two companies say initial testing of the service shows that it has ‘considerable accuracy in terms of Auction.com's ability to predict market performance.’

Auction.com made news earlier this month when it announced that it was launching Auction Finance, a new division created to facilitate financing for commercial and residential real estate investors.

Financing options will be provided by Auction.com's preferred lenders and will count towards a buyer's proof of funds – a requirement for bidding on all properties offered for sale on the Auction.com platform.

Part of the goal of the program is to increase buyer liquidity, which, in turn, will allow a much larger audience of potential buyers to participate in the company's residential and commercial real estate auctions.Â

In a release, Jeff Frieden, CEO of Auction.com, says the initiative ‘is directly aligned with our core business strategy, as it allows us to increase our audience of potential buyers, improve our ability to get sellers a fair price for their properties, and expand upon our position as the nation's leading online real estate marketplace.’

Gordon Smith, executive vice president at Auction.com and formerly a managing director with Fortress Investment Group, a leading global investment management firm, will head up the new line of business.

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