WIDGET UPDATE: Since the pricing widget has now been up and running for exactly six months, we spent a little time yesterday looking at some data to try to see if it has any predictive ability. We came up with a list of twelve properties that had been both subjected to the widget treatment and gone on to sell. The findings were quite interesting: In every single case, the average predicted selling price fell short of the actual selling price. The interesting thing was the consistent range by which the widget underpriced. The widget price was between 9.4% and 19.8% under the ultimate selling price; on average the widget underpriced by about 14%. So we’re going to create a second-generation widget that shows average and median predictions as well as a predicted selling price based on the historical track record. Hopefully that’ll get done in the next couple of weeks. The twelve data points are listed below. P.S. If any reader would like to become the official keeper of the widget spreadsheet and try to keep an eye on this stuff, we’d be more than happy to hand it off!
On the heels of yesterday’s discussion about the price widget prediction falling short for the second time, a reader sent us a third data point. Once again, the average appraisal fell far short of the selling price. After being listed for $899,000, 29 Maple Street received an average prediction of $727,425 from readers; the house closed for $830,00 on July 6, 2009. Maybe the fact that the average prediction is, thus far, falling so far of the sales price makes perfect sense. After all, the seller only needs one good buyer, and anyone putting in a bid is probably going to like the house more than the average reader. In this case, it looks like somewhere around 20 to 25 percent of the votes cast were at or above the actual sales price. Maybe we should switch to using the median and noting the three quartile break-points. Could it be that the top quartile is really the predictive number? We’ll wait for a few more data points before overhauling but it’s certainly feeling like that may be the more useful way to parse the data.
House of the Day: 29 Maple Street [Brownstoner]
29 Maple Street [Brown Harris Stevens] GMAP P*Shark
Bearish Brownstoners Miss Mark on 2nd Street Sale [Brownstoner]
So far we have precious few data points on the predictive powers of the pricing widget. For a while, the only HOTD or COTD to sell was 316 Cumberland Street, which sold for $2,250,000 in June, a shade less than the asking price of $2,295,000 but almost $360,000 more than widget voters predicted. And now our second data point shows an equally bearish disposition: 93 2nd Street, which generated a predicted selling price of $914,379, just closed for $1,086,312; in our defense, we said at the time that “We could see it getting pretty close to” the asking price of $1,125,000. Interesting, eh?
House of the Day: 93 2nd Street [Brownstoner]