#053: How Big Data & AI Impact Real Estate Investing

Todd Teta: You can cross the street and be attending a different school or maybe even a different school district and see a 10, 15% drop in in the value of homes just simply because of that. Which is you know, not uncommon.

Intro: Welcome to the accelerated investor podcast with Josh Cantwell, Josh Cantwell. If you love entrepreneurship and investing in real estate, then you are in the right place. Josh is the CEO of Freeland Ventures, real estate, private equity, and has personally invested in well over 500 properties all across the country. He’s also made hundreds of private lender loans and owns over 1000 units of apartments. Josh is an expert at raising private money for deals and he prides himself on never having had a boss and his entire adult life. Josh and his team also mentor investors and entrepreneurs from all over the world. He doesn’t dream about doing deals, he actually does them. And so, his listeners and students now sit back, listen, listen and learn, learn and accelerate your business, your life, and your investing with the accelerated investor podcast.

Josh Cantwell: Hey, welcome back. This is Josh Cantwell. The host of accelerated investor. Thanks, so much for joining me no matter where you are in the world. Welcome to America’s number one real estate investing and entrepreneurship podcast. Today I am really excited to be with the chief product and technology officer at Attom Data Solutions. His name is Todd Teta and Todd helps bring products to market for the really institutional large clients as well as the on the ground, boots on the ground. Real estate investor. Attom Data is one of the nation’s leading the providers and aggregators of data relative to the real estate industry, real estate investors, big companies, small companies, mortgage companies, and we’re happy to have him to have a conversation around how big data and artificial intelligence is impacting real estate investing around the country. Todd, thanks so much for joining us. How are you?

Todd Teta: I’m well, thanks for having me, Josh.

Josh Cantwell: Yeah, you bet. So, Todd, let me just ask you to kind of kick things off. Just tell a little bit of our audience a little bit more about Attom Data. What does exactly Attom Data do?

Todd Teta: Yeah, great. You teed it up pretty well there, but zooming out a little bit, we, we collect and curate around 50 to 60 different data sets about the real estate market. And then we organize that into products or data, what we’d call data solutions that we sell into the real estate market, the investor market hedge funds and institutional investors as you described. And what we’re really helping them do is a couple of things. One helping them in their marketing efforts. So, either making smarter decisions about who to market to or what the content of the marketing campaign might be. And then secondly the second major use case is around risk. So, helping them to make decisions around something in their business that could be entering a particular market, buying a particular house selling a particular house, maybe underwriting a particular, you know, hard money loan, whatever it might be. But really just risk decisioning and understanding the risk of a particular real estate asset.

Todd Teta: Got It. So, Todd tell us more about, you mentioned 50 different data sets that you guys pull from county records as well as multiple other sources. What are some of the different data sets that you guys are pulling, aggregating, spinning around in your kind of witch’s brew, if you will, and then that turns into products based on all these overlays of data. So, let’s just start by talking about what data are you guys pulling. And then secondly, when that spins around into products, give us an example of some of the products that actually come out of, out of the overlays.

Todd Teta: Sure. Yeah, absolutely. So, we think of it in four major buckets. The first is information about the property itself. So, things like beds, bath, square footage you know, things that might come off of a tax assessor record where they’re collecting very basic information about a property sales history, mortgage history of a property. You know, those are things that might come off of the recording process when you buy or sell a home. It even further we aggregate MLS listing information, imagery around the property. Kind of zooming out from property specific information. We look a lot at neighborhood-level data because location, location, location. And what we think about there are things like crime demographics amenities in the area and maybe in the form of points of interest, restaurants, things like that. You know, transit areas. And so, neighborhoods, information is really a core part of that, schools. The third bucket is we kind of layer on top of that this, the, the, the raw data if you will. Geospatial. So, think maps. And that’s things like school boundaries you know, school district boundaries. So, what that allows us to do is make decisions around how maybe school quality impacts real estate,

Todd Teta: Which it definitely does, right? Neighborhoods… A, B, C, you know, different types of neighborhoods definitely impacts value along with quality of schools and packs value big time.

Todd Teta: That’s right. You can cross the street and be attending a different school or maybe even a different school district and see a 10, 15% drop in in the value of homes just simply because of that. Which is you know, not uncommon. The fourth bucket, which is a, you know, really tying into some of the conversation we’re going to have around artificial intelligence and big data is what we would call analytics type of products. And this is where we take all of those other data sets and throw them through the witch’s brew and make decisions or derive information out of the other data things like, what’s the value of a home that you can’t necessarily intuitively just pick up off of a prior sale. But we’ll look at all of our other data and make an empirical decision on what the, maybe the value of the home is or the equity position of an owner is you know, school quality ratings that we look at relative to, you know, value, et cetera. So yeah, that, that, that’s the four major buckets. They do, like you described where we make decisions and, and provided out in, you know, either report format or in many cases, you know, dis answers to questions rather than just here’s all the data.

Todd Teta: Yeah. Many people may or may not know that Attom Data is the parent company to realty track. So, they produce products around the ability to just export lists where you can overlay different criteria about motivated sellers, right? You can overlay lists that says the house is vacant or it has a certain percentage of equity or there’s maybe a foreclosure or there’s an out of town owner because, or there’s you know, they’ll all these different types of data where the owner may live out of the area or not live in the property because there’s a forwarding address. There are all these different sets of data. So, Realty Track is what many people know initially because just the brand. But other things include reports you guys do and, and other things that, you know, information that you provide to institutions. Is there anything else that sticks out or any popular products that institutions and hedge funds buy that maybe the regular mom-and-pop investor’s not aware of?

Todd Teta: Sure. Yeah, absolutely. So, we get a lot of interest from hedge funds around our market analysis. So, you mentioned some reports that we do. We’ll look at markets from a number of different factors and make decisions on what’s the best yield for an investor, what’s the best ROI you know, maybe where the most appreciation is going to happen or conversely, where a bad market is and where you should get out of. So, a lot of hedge funds and institutional investors are keenly interested in that because they’re operating on, you know, hundreds if not thousands of homes within these markets. And any signal they can get to make a decision on, on those markets. So that’s very applicable to the, to the smaller investor in the mom-and-pop investor, if not more so at the home level.

Josh Cantwell: Yeah, because you said investing in a B market versus a name market versus a c market, you know, you can get a lot more cash flow in a C market, but property values are gonna be lower and you have a tougher time selling that property. And knowing that right out of the gate is a big deal. For very sophisticated advanced investors, like we know our markets pretty well, but we tend to invest in our own backyards, right versus an institutional investor. They may be, you know, their desk is in Wall Street and they’re investing in Memphis and Cleveland and St. Louis and they’re investing purely off of the data that you guys are providing and other companies are providing that don’t actually go out and they’re not investing in their own backyard right there. They’re investigating the high cash flow markets or high equity markets.

Todd Teta: Yeah. And that’s why we believe there’s always going to be an opportunity for multiple angles in investing, you know, local investors of which I’m one, myself and my home market, you know, it, you’re always going to have an opportunity and simply because you know, you know, rehab values better, you know, what sales prices are going to be better than somebody, you know, operating off of a model. We, we firmly believe that. I, I say that as a data person, but you know, I, I believe it that you can’t just simply operate without boots on the ground.

Josh Cantwell: Yeah. With boots on the ground and you may not need to buy a bunch of data because you can get a lot of data just from your local county auditor’s or county recorder’s website. Maybe you use some software and the MLS and if you’re only doing six or 10 deals a year, you can just look at, you can literally drive neighborhoods and find out, well that house sold for $210 and this house is selling for $170 and oh there’s that one over there for sell for $105 that’s a deal, right? That’s right. It’s as simple as that versus a, you know, big data.

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Josh Cantwell: So, Todd, just tell again, tell us the difference between what is big data versus artificial intelligence and how do you, how do you define artificial intelligence? What’s the difference between the two and how do they play well together?

Todd Teta: Sure. Yeah, it’s, it’s, there’s simple way to think about this. One in big data is really about the content itself. So, information getting generated either through your online browsing behavior or maybe credit card transactions or in the case of real estate maybe through a smart home type of Thermostat, like a nest. Just the raw information getting collected and stored and organized in a way that is, makes it consumable. That’s just the idea of big data, that there’s this increasing volume of it. How do you best organize it? Whereas artificial intelligence on the other hand is about taking, you know, it could be taking data or something that a human maybe does today and building software that operates like that human best example of it is something like Alexa or Siri. Those are very much built on artificial intelligence technologies. They sit on top of these giant stores of information that have been collected the big data part you know, things like conversations or you know, prior interactions that Alexa may have had with any consumer. And what they’re trying to do is mimic conversational speech on top of this large Dataset that they’ve collected over time. So, think of, you know, Alexa as the AI underpinned by a lot of content that makes it possible and that’s the big data part.

Josh Cantwell: So, Todd, let’s talk a little bit more about how data is changing. You know, we have sort of traditional data that we can get from the tax assessor’s website or the county recorder’s website versus what we call what you call emerging data or changing data or data that’s giving us idea of what the future could look like or what the immediate future has in store for us. So, help us understand the difference between traditional data emerging data and then we’ll talk a little bit more about how this is impacting the market.

Todd Teta: Right? Yeah. And I think it helps to use an example here and there’s a couple on this slide that, that hit on it. You know, you think about historical knowledge investors had about a property. It was things like when did it sell? who bought it? you know, how much did it sell for, et cetera. What investors now have access to and are starting to get access to are things like energy efficiency. You know, how efficient is the actual house, what the operating costs might be. You know, other things like the actual age of some of the HVAC machines are FAU. You know, how, how old are those or how efficient are those? Those are all data points that are getting enabled by some of the new collection that’s out there. So, you think about a smart thermostat like a Nest you know, that’s collecting efficiency data where it might look at two very similar homes and one whose air conditioner’s running 24 seven to maintain 72 degree temperatures and you know, Phoenix in the summer.

Todd Teta: Whereas another one’s, you know, maybe only on for 18 hours a day. Different operating cost structure for that in a property you might be looking at. Similarly, in neighborhood information, everybody’s always had info on, you know, what are the basic demographics of an area. What we’re starting to see is a lot more slicing and dicing of neighborhoods. You know, down to the home level where you can look at, you know, who that buyer and that home is, who the lookalike buyer might be. You know, I’m thinking of the sales side more than anything here, but who the lookalike might be. And you know, they may live in a yeah, but they have the exact needs and wants and data’s enabling you to kind of find those guys now. So, it’s, it’s really about this data that didn’t use to be available and helping you make smarter decisions.

Josh Cantwell: That’s fantastic. So how does then AI overlay over top of that to really bring this information to the public, bring it to hedge funds, institutions? Tell us a little bit more about where to go in the future. Right. And forecast based on, hey, like this particular city looks to be a profitable city to be investing in maybe in the next two to five to 10 years. And also, within that city potentially. Are there neighborhoods, other city like micro cities or micro areas where the analytics are telling us like go here, forecast is going to tell us this is an emerging area.

Todd Teta: Sure. Yeah. And that’s a, that’s a great example of analytics playing a role in decision making. These are some of the areas on this slide that we see AI having meaningful impact today. You know, candidly, a lot of AI, not just in real estate, but just generally it’s still in the R&D phases. You’re not seeing a lot of AI out in day to day production, you know, use you know, beyond the, the, the Alexis and Siri examples I gave earlier. A lot of it’s sitting in the research labs, but these are areas, these six points I’ve, I’ve listed here are real-world areas that AI is impacting real estate. You know, we see a lot of examples of this. You know, we see a lot of new companies, which we’re gonna talk about in a minute that are leveraging this kind of technology to, you know, drive better engagement for their customers.

Todd Teta: We talked about the smart home example. You know, you mentioned forecasting of markets. We see hedge funds regularly building AI based models to do micro forecasting and you know, buy-sell decisions at extremely granular levels. You know, new test scores are coming in every year for maybe school qualities they can find or predict. How that might impact home values you know, a year or two before they actually show up. You know, so things like that are real world examples. But I, I would caution the audience to, to realize that a lot of AI is still in the R&D phases and there’s a lot left to, to come out. Exciting stuff. Certainly

Josh Cantwell: And, and so I’m, I’m interested in seeing things like Zillow, right? Is now saying we’re going to go buy 100,000 houses this year. They’re actually are buying properties and basically flipping them, you get companies like offer pad that are out making offers, you’ve got iBuyer, you’ve got these large institutional buyers and they’re not doing a lot of buying low value add investments of meaning making, doing big rehabs and then putting a new product back on the market. They’re, I believe, and you can correct me if I’m wrong, but they’re using AI to determine like, this is a property or this is an area that seems to be like a value add play where they can just buy low, maybe not do a ton of improvements, but they’re, there’s some need to, to resell and they’re able to resell the property without really doing a whole lot to it.

Josh Cantwell: I mean, I don’t, I don’t think Zillow is going to be rehabbing a hundred thousand homes. I could be wrong, but they’re probably making some analytics play it very similar to why a stock broker simply sees a stock that’s on sale. They buy that stock, they hold it, and then they sell it in the future because now the market has realized that the stock actually should be worth more. And that’s a, that’s the way I kind of feel it. I’m not sure if any of that is accurate, but that’s the way it feels to me. So, I’d like you to just comment on that. Like, how is, how has this new analytics, this new business of big data and AI creating these new tech companies that are making these large decisions.

Todd Teta: Yeah, yeah. And iBuyer market is, is absolutely one that’s leveraging technology more than, more than most, more certainly more than the traditional, you know, say relocation companies or brokerages that are out there. Yeah, and you’re right, you know, the iBuyer companies have a variety of different business models. Some of which are you know, intended to be large scale, quick turn in a large scale being high volume relative to maybe you know, a hundred to 200 home flipper. But they’re doing it on extremely thin margins. And, and you’re right. Not Making major rehab work. So, there’s a formula, you know, they know what the formula is and they’re sticking it, sticking very much within that box. And not taking risks on, you know, nuanced properties or challenging properties or, you know, certainly something with a, a major rehab issue, like a slab, you know, cracked slab or something.

Todd Teta: You know, they’re, they’re buying a very you know, narrow traditional three, you know, three and three you know, in Phoenix that’s been, that’s no more than 15 to 20 years old. And that’s, and that’s what many of them are buying is that formula. You know, we think about Zillow. Zillow has come out and said something slightly different than the other ones. And I think it’s a function of them having so much consumer eyeballs and it’s that they believe they’re a market maker in the consumer real estate space. So, you know, when you, you use this stock market example where, you know, a stockbroker wants to sell us a stock or consumer wants to sell a stock, you know, oftentimes somebody else is buying that home or, excuse me, be buying that stock and then putting it into the general market for, for, you know, repurchase by some other investor.

Todd Teta: You know, it’s very often, very quick in the stock market. You know, it happens instantaneously, but that’s the concept of the market maker creates some liquidity. And Zillow has, you know, unlike the other iBuyers that are out there come out and, you know, claim that that’s really the, the function is to create some liquidity for sellers. Our, our, our sense of it is, you know, we liked the business model. They’ve raised out business models of all of these companies. You know, I’m impressed in the, in the sense of them being able to take some of this technology and apply it to a real use case. You know, we believe it will be a part of the market. We definitely don’t see, you know, a e significant, certainly not a majority market share. For something like this. You know, but, but there is a segment of the market that wants a little bit more liquidity when you’re selling.

Todd Teta: Right. And these iBuyers, you know, ideally offer some of that. The other side to it, and I, I’ll use Zillow and Redfin and you know, more recently Realogy and, and KW by offering this as well creates a lead gen opportunity. So, there are a lot of sellers who go on to the sites and you know, maybe the offers not what they want. You know, from the I buyers because they are buying at a discount. But it creates a lead opportunity for you know, brokerages. And so, we’re seeing that that it’s also a lead gen play for some of the companies that are out there.

Josh Cantwell: Yeah, I believe it’s probably more of a lead gen play than anything in my personal opinion, generating traffic and eyeballs. Because for years realtors have said, you know, there has been a different marketing hooks that said, know we’ll sell your house in 45 days or we’ll buy it and we’ll buy it means we’ll buy it, but we’re going to buy at 65 cents on the dollar. Right? So, Zillow was basically going out and saying, we’ll make offers on your house. And all of a sudden now the seller is engaged with Zillow in some capacity to potentially sell and purchase the home. But the offer might be, again, at a number that’s too far of a discount, but the seller is now engaged with Zillow. Zillow now can then sell off that lead to one of their PR premier agents that advertise on their platform and it becomes a listing, right?

Josh Cantwell: Yeah. I mean, let’s be honest, here is still over. Well over 80% of all real estate that’s done in the United States is done essentially by mom and pops. If they’re investors and there’s buyers and sellers, they’re are done by mom and pops that do just a few transactions a year. Even the huge rental companies that own like American Homes For Rent and these massive institutions, they only own about one or two or 3% of the overall market. Even though the Blackstones of the world and these big massive institutions that own forty thousand fifty thousand doors, they get a lot of publicity and they get, they get market share by being on the front covers of magazines. They’re really not that big of a player when it comes to the overall market because they only are playing in one, two, 3% of it. So even the facility does 100,000 you know, it says they’re going to buy 100,000 houses. It’s again going to be a relatively small percentage of the overall market, so it looks sexy, but it’s not really impacting what we’re doing as local investors. Right.

Todd Teta: But that he hit it on the head. That’s my take too. You know, you’re, you’re saying 100,000 homes that’s spread against a year, you know, and it’s spread against the whole US you know, 5 million homes a year on average selling. So, you think about the math there it is a small piece of the Pie. You know, the, the thing I’d caution, and I, we talked to a lot of agents out there is, you know, it’s another channel that’s out there. You know, don’t, don’t, don’t be afraid of it. But also, you know, don’t ignore it. Don’t ignore it. I, you know, I talked to a lot of agents who open doors in their market and you know, say the inland empire here in southern California you know, they now have 70, 80 listings in their app and then the empire not so much as an owner are they impactful, but a lot of brokerages would love to have 60 to 80 listings right now. And so, there’s that dynamic of competing with agents and brokers that I think we don’t want to discount.

Josh Cantwell: Yeah. There’s definitely a new technology where there are companies buying properties, the iBuyers, the Zillows, they are buying some, but for the most part, my take on it is that it seems like it’s, it’s a new way. It’s a new way for old companies like Keller Williams, like Zillow, like Remax to get more eyeballs to get more market share.

Todd Teta: I would Agree with you. Yeah. I think it’s a reaction. You know, the KW is the Remaxes and the Realogies in particular you know, there, there’s a lot of pressure from their agent base. They’re getting their agents stolen by Compass and EXP you know, just writing large checks. And so, they need to do something to respond to re it’s a retention play in a lot of ways in my mind as, as the tech technology tech investment that they’re making et cetera. So. Yeah, absolutely.

Josh Cantwell: Very cool. So, what are some of the coming trends? What are some things you see regarding data AI, just investing business models? What are some of the things that you anticipate seeing in the next maybe six months to five years based on some of the stuff you see as an insider and dealing with big data and working with big institutions?

Todd Teta: Yeah, absolutely. I think of it as a three. You kind of three buckets you see here. You know, on the data side, one trend we’re really watching is this question of smart home. You know, how, how impactful that is going to be on, you know, insurance premiums on sale prices on, you know, repair requests. Something as basic as that. You know, how that data collection that’s happening around smart homes could impact any of those areas. You know, positively, you know, but as a positive factor a negative factor you know, on the AI Front, I think the most interesting one can candidly is, is that, you know, hyperlocal market segmentation, people getting smarter and smarter about you know, the slicing and dicing and nuancing a property. I’m not excited necessarily for the fact that we couldn’t do it before. Because, you know, I would argue appraisers are pretty darn good at that. Especially ones that do repeat appraisals in an area and know areas. But you know, appraisals are 600 to a thousand bucks in a lot of markets. He the ability to bring that down market, you know, pre offer as being a very interesting scenario and, and, and bring it a little bit of you know, the back-end process up front at a lower cost. Trying to think…

Josh Cantwell: When you, when you bring up appraisers again, I know appraisers do a fantastic job of really dialing into a market, but for $600 to a thousand bucks per appraisal, if data can be, again, thrown into the witch’s brew and segmented around and pull really relevant, multilayered data out, a lot of times you can get these kinds of reports or get this data for a small subscription fee, you know, $30 $40 $50 per month, or sometimes even cheaper. Or sometimes you can pull an entire list out or a report out for, you know, I mean $10 $50, $200 and get a lot of that same information and you can get it at scale, you can get it at volume, you can get it in multiple counties, multiple states, multiple cities. And so, you’re really, you’re, you’re really flipping the whole potential appraisal market on its head because the value of that appraiser on your local deal is great. And you kind of need that to get across the financing goal line with your local bank. You got to have an appraisal, but for the same dollars, 1000 bucks, you can get amazing information about your market and motivated seller lists and information about the marketplace. So that could be a potential real change in the future.

Todd Teta: Absolutely. Yeah. Even if it just brings prices down or move moves the step up to pre offer, I think that’s, that’s great. And that it’s, it’s cute, huge use of the data. You’re right. And you know, we’re one of those companies that offers, you mentioned Realty Track that is our consumer website where we offer some of this data, you know, for $50 a month you know, pretty unlimited access and a lot of a lot of investors, you know, that’s enough to get them into to filter down on deals. And then that’s the whole point. You know, you, I am not of the perspective, despite my role and, and what I do every day. I’m not of the perspective that I’m ever gonna replace the, you know, my human decision making that I make on my deals at the end of the day. But I want to cut through a lot of noise in the process and you know, bring efficiency to how, how I, so if I want to look at one or two deals a week that is meaningful you know, that’s what I wanna achieve rather than looking at, you know, a hundred listings.

Josh Cantwell: And I think what’s a market being so competitive now and things being so good for so long. It was so many people now looking at real estate, whether it’s single family, multifamily, commercial you do have to look at it a lot more deal flow to pick the deals that you want, right? We might look at a hundred apartment complexes and put LOI out on 10 of them and hopefully buy one, right? Or you might make 30 offers on a residential property to get one or two good deals. So you’ve got to process a lot of information up here at the top of a funnel to have it sift and sort through all that stuff to get down to one or two or three really good deals that you want to buy and you’re really committed to adding to your portfolio versus in the past like, well, you know, there’s 20 deals on the MLS, I’m going to make offers on 10 I’m sure I’ll get one or two.

Josh Cantwell: You just went right to the MLS and skipped all this sifting and sorting, right? Yup. And now that there are so many more institutions that are tech savvy and data savvy and real estate savvy, that really isn’t going to change. I don’t think the competition in the market is going to go down, even if there’s a recession, which we expect to see sometime in the next two years or less. I don’t think all of a sudden there’s a bunch of people going to exit the market. I think people are waiting for a recession, dying for a recession to see prices go down. So, I think there’s going to be a lot of competition in real estate for a long time because of all the data and the technology and the AI that’s been

Todd Teta: Introduced. And it’s an arms race. I mean, I would argue it’s an arms race. There’s a lot of dollars being invested in this space, you know, three, three, three and a half billion last year, you know, two to five the year before. And all of these different business models and that money is turning into, you know, at least these types of tools we’re talking about.

Josh Cantwell: Right. Yup. Fantastic. So, future business models, what do you see as far as potential changes that are.

Todd Teta: Yeah, I’m mostly interested in, in tracking. A couple of things I point out, the two first two bullet points on this slide are, are probably my most interesting ones that I keep an eye on and then say idea of private listing clubs. They’re not new. You know, the technology and certainly the, the business model hasn’t been you know, around or hasn’t, has been around, excuse me, for years.

Todd Teta: You’re just seeing a little bit more activity and some funding into that space again. So, I, I sort of view it as it’s another, another channel, another distribution channel for agents to, to work within and investors. You know, I, so I, so I’m interested in that one. I hope they get traction and, and start, you know, competing if you will, with the MLS consolidation that’s happening nationally. You know, and then the second one is an efficiency play to me and really meeting the consumer need. And it’s the, you know, just more proliferation of remote showings, virtual showings. I will reference this as it relates to iBuyers to it’s a lot easier to do this when the homes vacant and that my buyer, you know, sort of brings to the table with that liquidity that they’re, that they’re offering in the market making function that they’re offering.

Todd Teta: It solves a specific need you know, on some subset of, of listings and, and I think you’ll see remote showings become much more prevalent in that situation. Home builders are already doing it very you know, probably a third of all home builders are doing it with our models now. You know, 24, seven showings and you know, sales office not open et cetera. And, and I think you’re going to see it in the resale side as well. But again, I think, like I said, it’s easier for a vacant home. But you know, we’re hoping that it takes off further from where it’s been. Right?

Josh Cantwell: Yeah, I like that too.

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Josh Cantwell: So, opportunities, like what does it, what does this look like going forward for the, you know, more of the residential investor, small-balance commercial investor. It could be new, intermediate, advanced. I mean some of our students and clients have hundreds and hundreds of units of single-family rentals. I mean, some of my friends and I have over 2000, 3000 units of apartments. It, but I would still consider us generally we’re not institutional would still fall into kind of the, maybe professional, but mom and pop if you will. What does it mean for guys like us? The good, the bad, you know, what does this look like going forward?

Todd Teta: Yeah, I’ll start with the bad. As it relates to everything we’ve been talking about. And it’s something I said earlier, most of this new tech is still being proven. It’s a lot of paper concept. You know, there’s things that are in the market today that are creating meaningful value and opportunity. But I would argue most AI, most of this, you know, analytics technology is still being proven. And it’s it, it needs to show the market that it that it can succeed. One of the results of that is that you know, there’s a lot of vendors out there, you know, there’s been a lot of funding thrown around. You saw the slide earlier on, knows something as simple as a brokerage model. You know, a fixed-fee brokerage model. There are probably four logos on that slide of fixed-fee broker models and, and several have come and gone.

Todd Teta: Picking partners and vendors as an investor is, you know, important to be cautious and don’t, don’t walk into long term anything long-term would be my suggestion. The other thing I’d mentioned is a, and this isn’t so much, you know, geared towards an investor question, but maybe more your partners they’re all struggling to find people that understand this stuff and can make use of G. And so, you know, it’s a, it’s a talent market is pretty tight. We try to hire quite often in this space and it’s, you know, we’re competing with the Zillows and Facebooks and Googles of the world. And as much as I like to think I have a good recruiting ability it’s not, it’s not easy to compete against those guys. And then on the good side, you, you hit this one, you know, the data’s becoming much more available, cheaper, right?

Josh Cantwell: Yeah.

Todd Teta: Ready Access. I’d say embrace that, you know, look for tools that are out there and, and data that are out there. And there’s a lot of different options for pretty much everything you might need, you know, whether it be you know, seller marketing list fragmentation tool or segmentation you know, or you know, a direct marketing list itself. There’s just a lot of options. We’re one of them. You know, we sell many of these tools, but there are a lot of, a lot of them out there, so that’s a good thing, right? Creates price opportunity. But it creates also you can test. And then, you know, this is again, probably more geared towards the agent side of the equation. It’s, I think consumers are just as freaked out about all this. You know, buyers and sellers as an investor are all freaked out about a lot of these different technologies. So being savvy about them and being not knowledgeable of them can help you differentiate. Absolutely.

Josh Cantwell: We’ve been buying data, so I spend at a software company back in 2006 today it’s called accelerated investor office and we buy data and part of it from you guys and we all sit and sort it into our software and it gets repackaged up and overlayed on top of all different kinds of other stuff. And we add all of that and people can look at properties, you know, based on Google maps and they can find out beds, bass and square footage, and they can find out how much equity is in the property. If there’s a divorce situation, a bankruptcy, it’s vacant. All these various things come together, and they can get amazing tools and apps inside the software. And 10 years ago, when I founded the company, it was hard. It was hard to find all this data. Today it’s so much easier so much better to pull all the data from and there’s price compression coming down and the cost of that data, which allows us to offer that on a subscription model out to our customers at an even cheaper price.

Josh Cantwell: We’re also seeing more competition doing the same thing that we do. So, you just really gotta be good. And at the end of the day, it also comes down to relationships, right? So, it comes down to when you’re dealing directly with the consumer like we do, or the investor like we do, or the borrower way like we do, there’s a lot of people that lend like we do. There’s a lot of people that have software like we do. I could provide coaching services like we do a lot of companies that have data, Todd, like you guys do, comes down to relationships. So as, as technology makes our life quote unquote easier supposed to make our life less complicated. Although sometimes it feels like the opposite. What this business really comes down to is relationships because slicing and dicing the data is one thing. Getting lists is one thing.

Josh Cantwell: But then dealing real estate is still a very human interactive business. Title companies, realtors, funding sources, whether it’s residential or commercial, all need to work together. And that’s the one thing that machines haven’t figured out yet. And it probably won’t figure out for a long, long, long time, is how to take all the data, make it work to actually get a transaction from A to Z, right? So real estate is still real estate doing residential and commercial deals. This data just is making our lives more options, more choices, which means we’ve gotta be really good at making good decisions about who we want to partner with and who we create relationships with. That’s ultimately what I, how I see this all kind of, you know, finalizing out, at the end of the day it’s, it’s about the relationship. That’s how you take the data and make it work for you to actually make money. So, Todd, appreciate your being on with us. I appreciate it. I’d love to have you back again, like we always have over the past several years, we have an amazing relationship with Attom Data. If our audience and our podcast listeners or YouTube watchers want to learn more about your company, use your services, what are some different resources that, that you guys have access to that they can get their hands on?

Todd Teta: Yeah, I’d recommend a couple things. One, our main website, which you see listed here on the slide, you know, that that’s where you go initially, and you’ll see a lot of information about the data and our solutions that we offer. And, I definitely would recommend investors take a look at our press room, which is the news tab there. We have a lot of reports we put out, you know, data every Friday about, you know, something interesting in real estate. You know, and it could be in market trends. A recent one we did was how does a grocery proximity to, you know, particular grocery store chain impacts the value of a home.

Josh Cantwell: Wow. Really all the way down to the grocery stores, Huh?

Todd Teta: Yeah. Yeah. So, in this case

Todd Teta: Fragment that out Todd, based on the actual grocery brand, like Myers versus Giant Eagle versus Kroger.

Todd Teta: Yeah. And we’re in different parts of the u s I think because we looked at, but yes, we looked at the top, you know, call it 50 different brands and it turns out that a Trader Joe’s, which is a, you know, West Coast chain and East Coast presence has huge correlation to home prices.

Josh Cantwell: Really? Wow. How about that?

Todd Teta: More so than a Whole Foods, which, which was quite surprising when we did it. So, wow. I think Whole Foods is only in the areas where it’s, you know, “whole wallet”. Right. but a Trader Joe’s, which is, you know, not the most expensive store we considered, you know, entry-level luxury was a great, a great place to buy a house,

Josh Cantwell: Whole Foods, whole wallet. I like that. That’s great.

Todd Teta: R an example of a report. And we do those once a month, like these larger reports, once a month on our website, you can subscribe to a, you know, our newsletters. What kind of interesting data points?

Josh Cantwell: Yeah. To my audience, I highly recommend it. The newsroom is huge. I’ve been featured in a number of their monthly newsletters that they put out, which has been really fun to be a part of. But even outside of me being in there, you know, I, I w I read that stuff, I look at it all the time. I mean our lending company, our Private Equity Fund that I run, we look at that data to see what’s going on in different markets. You know, what are the best rental markets for buy, fix and rent. What are the great markets for buy, fix and flip? And we rely on that data and there’s new stuff that comes out every Friday. So, you can really spend, you know, part of your Friday and weekend reading and really learning about your market and what’s going on across the country. So, an amazing resource there as well. And then so you know, Todd, if anybody wanted to reach out and contact you guys for more information, whether it’s buying data up, buying lists, realty track, they can also go to your website there as well, right?

Todd Teta: That’s right. Yeah. There’s a link to Realty Track right on the website there’s a link to our lists, our marketing list product right on the website. And then there’s a contact us form. If you want to talk more, I’m happy to, to come back as well Josh on another day and we’ll talk some more about the market because I can tell you’re super passionate. I’m super passionate about this stuff and the, you got to keep an eye on it.

Josh Cantwell: Yeah. You Bet. Guys, listen, if you’re looking for a list to use for motivated sellers, so those of you guys are looking for more wholesale deals or rental properties or fix and flips or buy-and-keeps. I’m highly recommend their tools because you can actually go source a list, overlay the data right on their website, export the list, and then just pay for that list one time. You don’t have to subscribe or pay a monthly fee and do that for years and years or make any kind of long-term commitments. So if you’re looking at, just get your hands on, let’s say a list of a thousand motivated sellers in your own backyard that are vacant with equity, that has an absentee owner, it’s, it’s an amazing source that you can go and just buy that list and then market to that list for the next couple of months and I’m sure you’ll get some deal flow from that. So, it’s really a great resource. We’ve used it many, many, many times. Also check out their, Adam, data.com/newsroom. Fantastic resource there. So, if you’ve enjoyed it, enjoyed our interview with Todd, definitely leave us ratings, leave us reviews, leave us comments. We’ll definitely have Todd and some other of his colleagues from Attom Data back on in the future. Todd, any kind of final parting shots, words of advice or resources for our audience?

Todd Teta: Yeah, no, I think just everything we’ve talked about is just keep an eye on the market. It’s shifting daily. And you know, take our newsroom and follow that. We put a lot out there. You obviously put a lot of content out. Josh, we and your tool do amazing things for your users. You know, use them. That’d be my, I guess my parting thoughts is use the content, use the tools that are available.

Todd Teta: Fantastic and thanks for having me.

Josh Cantwell: You Bet, Todd, anytime. We’ll definitely have you back on. Look forward to seeing more of your content and reports that come out on trends in the marketplace. Thanks, so much for joining us.

Outro: You’ve been listening to Josh Cantwell and the accelerated investor podcast. Leave a comment on our iTunes channel and let us know whether you want to learn next or who you’d like Josh to interview while you’re there, give us a five star rating and make sure to subscribe so you can be the first to hear new episodes. Follow Josh Cantwell in his companies, Strategic Real Estate Coach and Freeland Ventures on all social media platforms now and stay up to date on new training and investment opportunities to start your journey toward the lifestyle you’ve always dreamed of. Apply for coaching at JoshCantwellCoaching.com

 

In my 20+ years as a real estate investor, I’ve noticed that the technology and systems available for assessing and predicting real estate market data have improved exponentially. 

Today’s real estate investor – even those who run simple, one-person operations – has to be constantly aware of the emerging trends and current data that impact their businesses directly. 

Luckily, you don’t have to be an expert in these areas… you just need to keep yourself informed. Companies such as ATTOM Data Solutions do the hard work of mining and analyzing real estate market data, so you can benefit from their knowledge. 

To learn more about this topic, I talked with Todd Teta, ATTOM’s Chief Product & Technology Officer. ATTOM is one of the nation’s leading providers and aggregators of data relative to the real estate industry, real estate investors, and mortgage lenders. 

In this podcast, Todd shares some insightful knowledge about how big data and artificial intelligence are impacting real estate investing around the country. He also explains how ATTOM’s data can help real estate investors plan their marketing strategies and assess risk. 

Todd is awesome when it comes to breaking down this information into clear, helpful bits, so be sure to check out what he has to say.

What’s Inside:

  • How ATTOM Data Solutions collects and curates about 50-60 sets of real estate market data
  • The four “buckets” of data that help REIs determine their investing strategies
  • Popular products that institutions and hedge funds buy from ATTOM
  • The difference between big data and artificial intelligence
  • The coming trends that ATTOM predicts will happen in the real estate market
  • The good, the bad, and the ugly when it comes to the future of a typical, mom n pop real estate investor

Mentioned in this episode​

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