BusinessWeek Investor -- The Barker Portfolio
Home Prices Are Just a Click Away
Looking for a good time online? No, not that kind. But next time you're on the Web, go to the Yahoo! home page. Scroll to the bottom, where it says Other Guides. Click on Real Estate. When that page pops up, look for Financial Tools and click on Home Values. Now, did you ever wonder what your neighbors paid for their homes? Type in an address and click. Yes! Next, try your ex-spouse's place, or that annoying colleague.
I'm warning you: It's addictive. If you've got an address, chances are you can peek at the public record of its sales history. My home is in there. So, probably, is yours. By now, you may think this is another assault on privacy. Maybe, but there's a benefit. Beyond their appeal to our curiosity, sites such as this are clarifying the murky market in residential real estate (table).
Unlike prices for stocks or funds, home-price data are hard to get. Just try using the microfiche file at your local library. It's a royal pain, making it tough to price a house you're buying or selling, never mind making a financial plan, for which having your home's value is key.
The Yahoo! site links to a service called Home Price Check, which is the brainchild of Steven Kropper, president of INPHO in Cambridge, Mass. Four years ago, INPHO began selling similar data by phone and fax. In November, it opened a free service at Yahoo!, and by January, Home Price Check was getting 1.3 million queries a month. Now, it's available widely at other portals, such as America Online and Excite.
But take care: These data are not necessarily accurate or timely. They go back no more than a dozen years and cover less than 75% of the U.S. Sometimes, Kropper says, the listed "price" comes from an appraisal or an assessment, not an actual transaction, something I found with the $1.35 million listed for Chase Manhattan CEO Walter Shipley's Summit (N.J.) home. INPHO shows a sale in March, 1997, but Shipley's spokesman says that's not so. Bear in mind, too, that divorce sales or other family deals can create screwy values.MIXUPS. For my own house, I found a correct record of the price I paid (look it up yourself), but the July, 1995, date was a month late. Worse, a June, 1990, sale also was listed. That shocked me, and not only because it was far below what I paid. I thought the last sale was in 1987.
The prior owner confirmed my memory and gave a possible explanation: In June, 1990, she bought her son a condo three miles away at the exact price Home Price Check says my place sold for that month. Someone may have mixed up the addresses. "They're not standardized, and most of the transactions are in hand-bound books," Kropper says. Getting them online means more errors.
So take these figures with a grain of salt. You can get prices and a more refined analysis of a home's current value at two other sites. One is run by Case Shiller Weiss, another Cambridge (Mass.) company that chiefly serves mortgage lenders and investors. It uses past prices, market trends, and comparable sales to estimate a home's value. Each quote costs $35, so you wouldn't want to do it just for kicks. But it could be a sharp weapon in negotiations. "It's persuasive because we're an objective third party," says CEO Allan Weiss of CSW.
HomeGain.com, an Emeryville (Calif.) site aimed at sellers, offers one free query when you register. The site then matches you with local real estate agents, who pay for the referral. Besides estimating a home's current value, its report includes recent comparable neighborhood sales.
These sites need lots of refining, but they're a big step up from microfiche. "As taxpayers, we pay for these records. We should have access," says HomeGain.com's CEO Bradley Inman. Besides, they're a good time.
For barker.online, go to www.businessweek.com/investor/ or AOL, keyword: BW Daily.BY ROBERT BARKERReturn to top