GoodPlace Analytics: Because Insights Matter, Not Data

Geek girlie at GoodPlace

So here’s the story so far if you’re not here since the beginning: we are launching a property portal which is rather different from whatever that’s out there today, and here’s how it’s going to be different:- it’s going to have lots of listings posted by lots of agents together with lots of banner advertisements placed by lots of developers. Booyah!

I’m just saying that in a jest, of course, because the truth is that the world doesn’t need another lame property portal, and I am damn sure ain’t building one even if I’m forced at gunpoint. Of course, it’s entirely self-serving for me to say this, but GoodPlace Homes is gonna kick major arse just because we are doing crazy things that other portals won’t even touch with a twenty foot pole.

Admittedly, starting a property site in Malaysia is one of the worst things that anyone can do to make money (side titbit: most portals in Malaysia hemorrhage money like it’s armageddon), but then again as the late Steve Jobs would say, you gotta stay famished and keep doing stupid things. Who am I to argue against the wisdom of Jobs, the most frequently quoted patron saint of tech entrepreneurs slash wantrepreneurs the world over?

Comic strip!

And like every startup out there today, chances of making it are about as slim as the probability of Malaysia winning the World Cup in this lifetime, but even if I crash and burn what have I got to lose apart from my time and a few bucks? At least I’ll have a cool story to tell my grand kids when I turn 80. Not too bad of a deal, really.

Anyhow the launch of GoodPlace Homes is now imminent, and the clock is ticking…

Alright, I gotta admit that I am now a little nervous because that damn thing ain’t anywhere near ready yet. The site is as slow as my Grandma in her 1950 Volkswagen Beetle, and there’s just not enough content to prop the portal up. It’s getting so bad now that I have started taking crazy pills. True story. (BTW, keep this between you and me, please. Don’t blab it to everyone and your father-in-law, especially if your father-in-law happens to be one of the investors in this little Ponzi scheme of mine. Thank you for understanding.)

 GoodPlace Homes: Because Insights Matter, Not Data

So here’s a particularly interesting comment from a GoodPlace reader posted to me last week regarding his experience with property portals:-

c-kam

This is the same old story that I hear from home buyers the whole country over. So many listings, so much data, so little time. And as Mr Kam above rightly pointed out, researching properties online is pretty much like trying to take a sip from a bloody Bomba hose.

Look, let’s be real. Unless you are a total geek like me, data itself probably wouldn’t excite you as much. You don’t want data. What you want instead is an accurate and useful interpretation of that data. In short, you are probably not that interested in analyzing transacted prices. You only want to know if that jerk who is trying to sell you his house is giving you a fair price or not.

In short, you want insights, not data. So do yourself a favour; don’t needlessly drown yourself in numbers. Save time. Let fat geeks with no social life like me do that for you, for free. Use GoodPlace Homes. You know it makes sense.

Pricing Insights

If there’s one thing in the home buying process that savvy buyers know that newbies don’t is this – asking prices in property listings are mostly bullshit. Smart buyers do their due diligence and go figure out the property’s fair value. How do they do this? The best way is to go to JPPH and do a transaction search on a similar property for comparison purposes. (Of course, folks can also go to their favourite property agencies for transaction data but for me, I only trust JPPH because being the data fetishist I am I like my numbers pure, virginal, and not tampered with. Yes, I’m sick.)

Our guide to fair valuation has (ahem) been downloaded 11,000+ times.

Our guide to fair valuation has (ahem) been downloaded 11,000+ times.

So here’s how the process typically goes for a buyer doing his/her due diligence to look for properties with fair value:-

  1. Buyer goes to property portal and search for listings.
  2. Buyer notes down the asking prices in the listings.
  3. Buyer goes to JPPH and do a transaction search.
  4. Buyer estimates the fair value (typically using the “Comparison Method”).
  5. Buyer filters out listings which are way undervalued (fake listings) and way overvalued (seller hallucinations) – say, outside the {+/-10%} range.
  6. Buyer shortlists the listings which are of fair value.

Adoi, penatnya. There has got to be a better way!

And thankfully, there is. 🙂 At GoodPlace Homes, we keep the most recent six months’ worth of transaction data which we then process (with ahem, our cutting-edge, 100% proprietary GoodPlace Analytics technology) the property’s fair value. For every listing which gets posted on GoodPlace, a “fair value sticker” gets displayed which indicates if the asking price is within a reasonable range around the median value of the past six months worth of transacted prices.

GoodPlace Pricemeter

With GoodPlace Homes, here are the only two steps you need in order to get listings with fair asking prices:-

  1. Search for listings.
  2. Shortlist listings with the “green” sticker.

That’s it!

Walkability Insights

Most property sites give you some information about the distance to nearby amenities (2km to the nearest bus stop, 7.6km to the police station, 12.567km to the beer joint, etc), but again, this is just a load of data which do not mean a whole lot if you really think about it. A 2km walk to the bus stop under a well-lit pedestrian shelter next to a police stop is more pleasant and feels more secure, than, say, through the dirty slums of dodgy Chow Kit area at 3am. Simply put, distance is often irrelevant.

Walkability scores for each listingInstead, we assign a Walkability score to listings which means one thing:- how friendly an area is to walking. Scored between 0 (worst) and 100 (best), the GoodPlace Walkability Score provides an objective method to evaluate a listing based on its location, and also as a measure to compare properties in two or more locations on an apple-to-apple basis.

Also, we have processed enough requests made through the GoodPlace DealMatcher to know that walkability is one of the most important considerations for the prospective buyers and renters especially for properties in KLCC and Mont Kiara. It’s therefore not surprising if walkability is strongly correlated to price appreciation. (We’ll share more about this in a future blog post, but our initial number crunching has yielded some pretty exciting results!)

For more on the GoodPlace Walkability Score and its underlying technology, read this.

Remember this: any Tommy, Dicky and Harry can tell you “what’s near” a property, but only GoodPlace Homes can give you insights about what’s really important – walkability!

Saturation Insights

Our pricing insights will give you an indication of how fair the listed price is – at this particular moment in time. To make sound investment decisions, you’ll need to know if the price is on an upward or downward trend, and for this, you’ll need to find out about the buyer and renter demand as well as the incoming supply in the area. Like everything else, prices of property are incumbent on two things: supply and demand.

If you want to crunch the numbers yourself, there are some well-established methods that you can use to estimate supply and demand levels – in fact, this was what we have done to debunk the myth that there’s oversupply in Mont Kiara. Let me warn you that there’s a lot of mind-numbing work collating different data sources and spreadsheet them to hell. Otherwise, you can rely on us fat geeks in GoodPlace HQ to do all the dirty work for you, for free! Introducing…

GoodPlace Saturation Index

Similar to GoodPlace Walkability Scores, the Saturation Index is on a scale of 0 (least saturated) to 100 (most saturated). On its own, the Saturation Index can be somewhat meaningless, and indeed it is supposed to be used to compare against other properties especially those in the nearby area (which are also affected by the same supply and demand dynamics). See this example (for MK11 in Mont Kiara) –

GoodPlace Saturation Index

The GoodPlace Saturation Index is a data point which provides insights on how pricing of a property may move in the future depending on supply and demand relative to its nearest, most comparable properties in the same vicinity. As such, this metric will be relevant more to investors instead of own-stay buyers and renters because it can be a surrogate to the yield potential which can make or break any (long term) investment.

I’ll spare you the technicalities behind the computation of the Saturation Index here, but even if you’re faintly interested, our methodology involves some heavy processing of data from Google (simulating demand) and our internal agent data (simulating subsale supply) as well as publicly available sources (simulating new supply). It’s pretty exciting stuff, and if you geek out for data like me and want to know more, contact me.

About Khai Yin

When I am not writing for GoodPlace.my and helping my readers find properties though the DealMatcher service, I spend time doting on my three kids: Wenyi, Qinyi and Eian. My personal stuff, some published essays and contact details can be found at khaiyin.com

Comments

  1. Looking forward to the new portal!

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