Big data: benefits for real estate

Data, data, everywhere

11 January 2018

Chris Bolam ventures into the maelstrom of big data to report on its benefits for real estate

Big data has become a bit of a cliché in recent years, to the point where few people can define it – let alone say whether it’s a problem or a solution. What we’re sure of is that data sounds a bit technical, so anyone who can handle a big chunk of it must be pretty clever.

Doug Laney, a US IT industry analyst, was clear that big data isn’t just an unwieldy amount of information when he defined it in the early 2000s with the now classic ‘3 Vs’ model.

  • Volume: big data doesn’t fit neatly into traditional concepts of disk and database storage, and probably needs multiple machines to store and process.
  • Velocity: big data is also being collected very quickly, all the time, from business transactions, algorithms and sensors that are ever vigilant, so there is an operational imperative to process it in close to real time.
  • Variety: big data isn’t homogenous. It’s not a predictable set of database tables, populated with the same points day in day out. It’s both structured, alphanumeric data and unstructured documents, emails, social media posts and so on.

In more recent times, a 4th V has been proposed – veracity – that really starts to get to the nub of the issue: big data is about processing a maelstrom of data and extracting a truth from it so quickly that it adds unprecedented business insight.

Imagine the 2.3bn smartphone users on the planet all walking around passively recording a new GPS point every few seconds, and feeding it back to perhaps a few hundred mobile providers. Collecting and working out what you can do with all that consumer insight is intensive and expensive – but is a good example of big data.

Applications in real estate

So where is the big data in the property surveying profession, and what should we be doing with it?

Let’s think in terms of those 4 Vs. Decision engines pull in automated valuation models (AVMs) or environmental, geological and flood data from numerical, documentary and map-based formats, so there is both a large volume and wide variety analysed to inform valuation decisions. And with the accuracy of a property valuation and the legitimacy of the mortgage application being of paramount importance, there are few data applications that require greater veracity.

We can argue that big data has been around for a long time

However, as the average UK property sale takes several months, it would be difficult to make a compelling argument for the velocity of data. That change is nevertheless coming, and we need to look upstream of the surveying profession to understand its origins. In many sectors, it is the frenetic nature of consumer activity that creates the wealth of disparate data points accumulating into big data, as in the GPS example above.

Estate agency is undergoing unprecedented transformation: as the primary contact point with the homebuying process for consumers, it was always ripe to be democratised by services such as Purplebricks, Yopa and the like. As the model becomes more fluid, dynamic and driven by digital self-service, consumer expectations of real-time access to transaction information and insight will increase. How many times has a given viewer looked at my property on my estate agent’s site? Are there trends that indicate their impatience to move, and perhaps therefore their propensity to be held to my asking price?

Start using this digital data to assess the overall stability of a chain, and suddenly a set valuation service level agreement becomes less relevant. Why not prioritise vulnerable cases as a function of the transaction value?

Case study

The biggest challenges we face as a surveying firm are: the disproportionate rise in audit over the past few years; satisfying the guidance requirements of 70 different lenders; answering post-valuation queries (PVQs) from lenders, solicitors or conveyancers; and providing consistent site notes. We therefore decided to adopt a tablet surveying app, primarily to ensure we have consistent, legible site notes that can be accessed quickly and easily, and improve our auditing and PVQ processes.

Landmark’s Q-Mobile has helped us to achieve this in 4 ways.

  1. The digital site notes are always legible, and in-built data validation rules clearly highlight errors, ensuring all the required information is recorded prior to sign-off. As a result, we’ve seen a reduction in monthly PVQ volumes after just 3 months.
  2. Q-Mobile is providing a 30% time saving on audit responses, as all the information, including the Rightmove comparables, is securely stored in our DataWeb case management system. Previously, we had to access a number of different systems to obtain the data and drive to our off-site storage facility to retrieve the paper site notes.
  3. We’ve reduced PVQ response times by 25%, since a large number can now be answered centrally without contacting the surveyor as we have immediate access to site notes.
  4. We’re now able to monitor the quality of site plans created using the Q-Mobile sketch tool more effectively, to ensure they meet our standards. We chose Q-Mobile ahead of alternatives due to the flexibility it offers, the close integration with DataWeb, and the ease of using Landmark’s Q-Mobile managed service – ideal for a business of our size.

Our team has access to the latest Microsoft Surface Pro tablets to run Q-Mobile, and with the monthly volumes we handle, there is no cost for the devices. We simply pay a set transaction charge for each case.

The adoption of the technology has gone well and our surveyors have adapted quickly to the switch from paper to tablet working. This is due to the logical flow of the site notes and the fact that surveyors have the flexibility to work through them in their own way. The Rightmove integration also makes the process of providing such evidence smoother and faster.

The responses from the surveying team have been positive, with a number of them already saying that Q-Mobile is saving them time on every job and that they wouldn’t want to go back to working on paper now.

All of our in-house surveyors are now using the tablet and app, and we’re in the process of planning the roll-out to the first 10 consultant surveyors. We expect the total number to reach 80–90 in the next few months.

Marcus Radcliffe is Chief Executive, Gateway Surveyors

A clearer future

Transparency and democratisation are synonymous with big data. The expectations of estate agents will be felt downstream by lenders and surveyors: consumers will require more clarity on how their valuation is calculated, and demand more control over what surveyors look at on site once they are equipped with better property information upfront. But rather than fear this, we should welcome the opportunity it brings to gain 360° understanding of the property transaction process and better comprehension of the property and environment as well as the consumer psychologies that so frequently disrupt processes.

Estate agency is undergoing unprecedented transformation

There are other areas of property valuation that big data can support. Replace veracity with opinion and emotion and we can argue that big data has been around for a long time in the form of the stock market. There are few better mechanisms for turning a prevailing political zeitgeist into an appreciable set of numbers – and few factors have so big an impact on the property market.

Imagine an AVM that modifies constantly and takes real-time economic indices into account. Big data is an ecosystem, not a discipline and, it’s our willingness to adapt to its evolution that will divert or deliver future opportunities.

Chris Bolam is Head of Product, Landmark Valuation Services

Further information