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"Big data": For market transparency, & better decisions


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"Big data": For market transparency, & better decisions

Orig. title: Lamudi's "Big data" - Will it aid market transparency?

Can it eventually make the PH property market more efficient?

 

If the Big Data concept is about greater market transparency, and more liquidity, I am all for it!

 

"Lamudi, with over 70,000-plus relevant property listings receiving 100,000-plus monthly inquires,

generates over 11 Million real-estate data patterns in a month"

Big Data x Real estate: Fear or awe?

By Amor Maclang/ June 27, 2017
 

A LITTLE taste of Big Data: Average condo properties in Mandaluyong appreciated in value by as much as 10 percent.

Demand for condos above P8 million in the city has grown by 4 percent, which peaked in the second quarter of 2016.

 

There is an insufficient supply of condo developments ranged between P10 million to 12 million. (still? or back in 2016?)

From Lamudi Philippines’s latest nationwide data service: The Oracle, set to roll out tomorrow at a demonstration event in Manila House for real-estate executives.

 

Lamudi, with over 70,000-plus relevant property listings receiving 100,000-plus monthly inquires, generates over 11 Million real-estate data patterns in a month. Positioned as the Philippines’s primary source for everything real estate, Lamudi will distribute the data-driven analysis through The Oracle to help its partners make informed decisions regarding where and what to build, at what price and for whom. According to Lamudi Managing Director Bhavna Suresh Chathambeth, the product chalks out trends in the local real-estate market, and narrows down the findings based on location, property type and price range.

“The power of combining the vast industry knowledge our partners have with the extensive information we collect for The Oracle, I believe we can do incredible things together for the market”

spk-brad-geiser.jpg

Brad Geiser, marketing futurist, cofounder, GeiserMaclang

Set to be officially launched on June 29, at the Manila House in Bonifacio Global City, Lamudi’s Oracle aims at offering real-estate developers and marketers a data-driven perspective on the conditions of the Philippine real-estate market.

Slated to speak at the launch is Dr. William Yu, lecturer for computer science studies in Ateneo de Manila University/Novares Technologies:

“This era of more data is both a challenge and an opportunity—a challenge to ensure privacy rights are respected and data is used responsibly and an opportunity to open a whole new space that is data driven with the creation of new products, services and models that are data first.”

Holding the panel discussion will be Eric Manuel, Urban Land Institute of the Philippines chair man of programs:

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Bhavna Suresh, country, manager, Lamudi Philippines

“The entire spectrum of real estate is impacted. From investors to occupiers, and from acquisition to operations to disposition of properties, Big Data is already an integral part of the competitive game. The winners of the Future of Real Estate will be the ones who can analyze that raw data and turn it into useful information.” Joining him will be Geiser Maclang’s marketing futurist, Brad Geiser

 

“There is tendency to feel that technology-driven decision-making is unnecessary in the face of expertise and gut feel. Unfortunately, there are dozens of unsellable buildings across the country acting as landmarks to this problematic mind-set. Millions are wasted on desperate marketing efforts, crazy sales incentives, brand-damaging price cuts trying to move these white elephants before they are quietly written off to experience.

With new and affordable access to massive, immediate consumer behavior; expertise and gut feel finally get a much-needed cross-check.”

 

Lamudi is a leading global property portal focusing exclusively on emerging markets. It offers sellers, buyers, landlords and renters a secure and easy-to-use platform to find or list properties online. Lamudi was established in 2013 in Berlin, Germany, and it is currently available in Asia (the Philippines, Bangladesh, Indonesia, Myanmar, Pakistan and Sri Lanka), Latin America (Mexico, Colombia and Peru) and the Middle East (Jordan, Qatar, Saudi Arabia and the United Arab Emirates). Within fewer than three years, Lamudi has established its presence as a key online real-estate marketplace in the countries where it is operating.

==

> http://www.businessmirror.com.ph/big-data-x-real-estate-fear-or-awe/

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Other requirements for true Transparency : TIMELINESS ! ACCURACY!

Transparency, and accurate data can benefit all the market participants.

 

There is much room for improvement in PH ... even for some users of Big Data, it would seem.

 

On 6/28/2017 at 3:25 PM, DrBubb said:

Lamudi's Pitch: "Big data" - What does it mean?

 

If it is about greater market transparency, and more liquidity, I am all for it!

 

A LITTLE taste of Big Data: Average condo properties in Mandaluyong appreciated in value by as much as 10 percent.

Demand for condos above P8 million in the city has grown by 4 percent, which peaked in the second quarter of 2016.

 

I am sure Big Data has great potential to help us understand the PH property market,

But telling us the market was hot and PEAKED in the second quarter of 2018 (or whenever), is NOT VERY USEFUL 18 months later.

The data needs to be current: hours old, days old, or maybe only a few weeks old  to have maximum value.

In Hong Kong, which has one of the MOST transparent, and most liquid real estate markets in the world, you can get very good, detailed and up-to-date data,

which is less than a week old.

 

Here's an example - Hong Kong's efficient property market, where good and timely data is easy to find:

==============

 

There's a general index, released every week by Centaline, HK's largest property agent

- and here it is, as released 12/15/2017: 164.46

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Centa-City Leading Index CCL          
Announced every Friday, latest on 2017/12/15; reflecting secondary private residential property price from 2017/12/04 to 2017/12/10 (based on scheduled formal sale & purchase date; on average, formal S&P are signed within 14 days after preliminary S&P)

The latest index level ( 164.46 ) was released on 12/15/2017 - Last Friday, being based on transactions reported during the week of 12/04 - 12/10/17.

The data is considered accurate, because HK prices are (ultimately) recorded by the government, and are believed to be accurate.

(This data used in producing the charts is preliminary, and is collected by various top agents, and often shared among them.)

 

Estimated average transaction prices are also released for dozens of modern estates, typically large properties built in the last few decades, where there are several hundred units. Imagine: Beacon Towers, or Ayala's The Residences at Greenbelt (TRAG) were in Hong Kong, there would probably be weekly reports for sales of these individual estates - and there would likely be a chart for both Beacon and TRAG, if they were HK projects.

 

The one below has four phases of high rise buildings, and a total of about 5,000 flats - I used to live there.

It is Tung Chung, within a few minutes drive from Hong Kong's airport.

ZPePaxI.png

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The Caribbean Coast development in Tung Chung, in HK's New Territories, West.

One of the larger developments in Hong Kong, with over 5,000 units (a tiny number of estates may have about 10,000 units)

 

What is the value of accurate, transparent & timely data?

How do all property owners benefit from it?

 

+ The easy availability of accurate and timely data builds confidence in the Market, and that tends to make it far easier for banks

to provide loans for purchases in the secondary market, because they have confidence in the collateral values that they are financing;

+ With banks providing loans more easily (than, say in PH), purchasers are more willing to buy, since they can put up a small amount

of equity (like 30-40%) and get a bank loan (or top-up financing) for the rest. Loans are granted quickly, and at low spreads over

funding costs. (As an example, a depositor at Hang Seng Bank, can presently get 0.75%, if they make a 1-year time deposit, while short term

rates are close to zero.) Since loans can be obtained at around 2.25% percent (or even lower!) - there is a spread of just 1.50% over the

1 year deposit rate. In the PH, the spread might be 4% or more. The lack of confidence in collateral values (and data!) may have something

to do with this wide spread.

 

+ In Hong Kong, a relatively modest discount to "market price"* can trigger buying interest in the secondary market.

I have seen rapid sales occur, when Sellers offer their properties at just 3-4% below the market price. In PH, buyers seem to yawn when

they see properties offer at 10-20% below market, and look for bigger discounts. Partly, this may because no one is very sure what market

prices are. And partly because interest rates in PH are higher, and loans are harder to get.

 

* A very interesting question is "what is the market price?" in the Philippines

Some people think it is the price set by developers. I don't think that is accurate or sensible, especially for sold-out of completed properties

 

> source: http://www1.centadata.com/cci/cci_e.htm

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PPAC started - Philippines Property Analytics Club

(There seems to be some real interest in developing new ways of collecting, modeling & using "Big Data" in PH.

Some initial discussions started in a Viber chat group, & were picked up in yesterday's Mastermind Makati Meetup group.

We have now started a new special viber chat: PPAC / Philippines Property Analytics Club, to have a special focus on Data & Analytics.

In the posts just below are excerpts from articles suggested by one of the PPAC group members):

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The analytical, "big data" approach is increasingly popular

The Use of Predictive Analytics in Real Estate Investing

> https://www.mashvisor.com/blog/use-predictive-analytics-real-estate-investing/

 
What is Predictive Analytics?

Although the term may sound complex, predictive analytics is not a difficult concept to understand. In a nutshell, predictive analytics is the art of analyzing big data by using past data to predict future trends...

Real Estate Markets and Analytics

Real estate markets are complicated, volatile and always changing and real estate investors want to be able to evaluate whether their potential property is a good investment or not. At the end of the day, all they want is to make wise investment decisions that maximize their return. With predictive analytics, investors will be able to objectively assess when and where to invest, optimize their selections and determine real value of properties. Additional metrics such as price forecasts, market cycle risks and desirability analytics are also key to such investors.

Guiding the Real Estate Investor

Predictive analytics helps guide the investor into managing their rental property in a more effective way, which results in a higher return on investment. For example, in Mashvisor’s Airbnb Pricing and Occupancy Insights, the company is able to predict what key variable should be focused on and what needs to be done to increase future occupancy rates, which in return will increase future cash flow. The same analysis can be used for the design of the home – should an investor buy a home with 1, 2, or 3 bedrooms and what number of bathrooms should be included? All critical facts that go into determining the investor’s highest return when it comes to purchasing a property.

Vs. Traditional Analytics

Sites such as Mashvisor and corelogic.com have been created to help real estate investors in making wiser investment decisions by using predictive analytics in order for investors to make more informed decisions. In the case of Mashvisor, big data is being mashed to help real estate investors properly assess housing market conditions, price forecasts, risk metrics, demographics shifts and market fundamentals in any given neighborhood throughout the United States. Unlike traditional analytics where big data was collected and analyzed to provide a retrospective perspective in what went wrong, today big data provides a snapshot of the big picture. This means that real estate investors can easily use these tools to make the best possible decision when it comes to buying an investment property.

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Predictive Analytics Helping to Boost Real Estate Business

SAN FRANCISCO (November 9, 2013) – Predictive analytics, or evaluating and interpreting data to predict future outcomes and trends, is helping the real estate industry better understand transaction and market data and use it to benefit the industry, agents and consumers.

Realtors® and attendees at today’s “Emerging Business Technology” forum during the 2013 REALTORS® Conference and Expo gained insights into predictive analytics and leveraging data to help Realtors® and local and state associations make better business decisions.

The National Association of Realtors® recently launched a new Predictive Analytics group that will examine and analyze member and customer trends from a variety of data sets to help the association determine and develop services and resources that provide value to Realtors® and give them insights into ways they can better meet the needs of their clients.

During the session, NAR Managing Director of Data Analytics Todd Carpenter said the goal is to use disparate data sources to build analytical models that will solve complex problems in the housing industry and to develop tools to help Realtors®, state and local associations, and others make better data driven decisions.

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> MORE: https://www.nar.realtor/newsroom/predictive-analytics-helping-to-boost-real-estate-business

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