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Sign into your accountThe Evolution of AVMs
March 04 2016
What’s the point?
Automated Valuation Models (AVMs) are a handy tool for quickly and simply providing an estimated value for a property. Nobody has quite nailed the science, as all AVMs are inherently wrong. A new trend is to put several different AVMs side by side, thus producing varying estimates of the same property. The value for consumers is in providing a starting point, a somewhat novel basis of what their home—or a home they’re interested in buying—is worth. The value for agents and brokers is in those consumers reaching out with questions; giving the broker an immediate opportunity to demonstrate their expertise by providing a more accurate and locally informed estimate. While providing multiple AVMs gives consumers more information, it also can cause confusion. This provides additional likelihood that a consumer will reach out to a local real estate professional.
AVMs have come a long way in the past few years. For contrast, take a look at the AVM landscape two years ago when I first wrote about it here.