Real Estate Data API Helps Agents Overcome Data Fallacies
A real estate data API is an essential tool for brokers and agents to help address what experts call “data fallacies.” When you deal with a product the sizable price tag of a home, these fallacies can be costly.
A highly probable seller in a neighborhood you are farming might misinterpret some data and suddenly make a 180-degree move against listing their home. Or, a highly-qualified buyer might look at the wrong data, decide to skip the home-search process and sign a rental lease for another year.
This is the Internet age. Consumers have access to billions of bits of data at the touch of a plastic case they carry in their pocket. Unfortunately, not all of the data they find is accurate. Secondly, they might not interpret that data correctly. And third, that data might not actually apply to them. Read on to learn about a few of the most common fallacies uncovered by experts.
Common Fallacies in Real Estate
Cherry Picking
Here’s a situation where a person, perhaps in a rush, happens to come across some data that influences their thinking. However, that information does not include the whole picture or does not include the picture that is relevant to them.
For example, a person might see a headline with a graph showing that home sales nationwide are down. Or home sales in their state have dropped. Even in their county. However, that does not necessarily mean sales have dropped in their neighborhood. In fact, their neighborhood may be one of the most desirable areas in a county where people are anxious to move. That could be because of the schools, a new manufacturing plant, proximity to a train station, etc.
By cherry picking, that person is just accepting one bit of data without the opportunity to see ALL the data involved in their particular situation.
This is also related to another fallacy called sampling bias, where people may draw conclusions from one set of data. However, that data does not necessarily apply to the area where they live and there is other information they should also take into consideration.
McNamara Fallacy
This is a fallacy where consumers rely solely on certain data and do not see the big picture and all the other factors involved. For example, perhaps that Mortgage Bankers Association reports that mortgage rates have gone up. Uh, oh, that’s the end of the world for many potential home buyers.
But what they might fail to see is that the increase in rates has only a small effect on their overall monthly mortgage payment. Especially if they are buying a home at the low end of the market or they are putting a substantial amount of cash down. In addition, sure mortgage rates have gone up, but there might be plenty of inventory available in certain markets, at very reasonable prices.
So, even if mortgage rates are trending upward, the hyper-local markets where some buyers are considering have some great bargains which will result in affordable monthly loan payments. As we all know, buying one of those homes is still a better investment than paying rent and helping the landlord build equity in a property.
Publication Bias
Publication bias is another harmful way to interpret data. As we know, the national media likes to sensationalize everything. So, they might come across a report, say from the National Association of Realtors, indicating that home sales are down this year. The national media blasts that news all over the place.
Television anchors lead with headlines about slow housing sales on the evening news while Americans are at home, getting ready to eat dinner. Local newspapers may carry that data as the lead story in the next morning’s edition. Sensationalism sells. Unfortunately, those screaming headlines could result in the loss of sales for local Realtors.
How many times have local brokers and agents had to constantly overcome negative national publicity in their local markets? They will tell you – plenty!
Those are just a few of the ways that consumers can be misled by data fallacies.
Real Estate Data API Provides Hyper-Local, Relevant Data
This is where it is advantageous for brokers and agents to have their own, reliable, accurate and HYPER-LOCAL real estate data API (application programming interface). That real estate data API is a feed of reliable, local information that consumers need to make intelligent decisions for their particular needs. The API gives agents the ability to offer that data, not from somebody else’s website, but on their OWN real estate website.
Sounds like a big job? It is. It would be if a broker or agent decided to attempt to gather all of this local real estate market data on their own. They would not only have to gather the info, find a way to verify it, and then code their website to display it, but they would also have to keep that data current.
That is a monumental task. Fortunately, there are real estate data providers such as Home Junction that already gather, sort and filter hyper-local data from a myriad of markets. All a broker has to do is add that real estate data API which is basically a few snippets of code, onto their website.
That broker or agent can then tap into an enormous database of hyper-local information about the markets they are farming. They can show trends in home prices for any neighborhood or subdivision they are targeting. They can also display charts for home sales for those markets. Even recent home sales. Or new homes for sale.
With a home valuation tool, a broker or agent can show prospects estimated price ranges for their property (or better yet, let prospects use this tool on their own and in turn, generate solid leads).
Agents can also show homeowners hyper-local data for the positioning of their home compared to other properties in their neighborhood. Perhaps their home is in the top 20% for square footage and in the top 50% for Age of the property. No matter what’s going on in the national economy, that’s a property that certainly has attractive attributes buyers will be interested in.
This is the age of instant information. Not only can consumers obtain access to data quickly, they can gain access to massive amounts of information from numerous sources. This certainly leaves the door wide open for problems and wrong impressions.
By using real estate data API tools from experienced data aggregators, brokers and agents have the opportunity to overcome these fallacies and provide reliable, hyper-local information that is truly relevant to buyers and sellers.
