How important is Open Data in Real Estate?

Data can show what humans cannot articulate clearly, or have not spotted.

Trends for price or demographics to see what the status quo is or where there has been change between points in time; indicators to alert people when or where something predictable has happened; and analysis of multiple data sets to find truth where human eyes just would never see (or believe).

Should large sets of data be available for analysis, would real estate agents, let alone consumers, really gain in a meaningful way? Do they 'feel' more confident about decisions on pricing, when is best to sell, or what development options have the most demand?

With much of real estate, available open data is not actual prices, but marketed prices. There is a UK Land Registry where 80% of UK land is registered (owners, price paid). Portals like Rightmove have much more data, but these details are less factual, but maybe no less reliable. 

Arguably, approximations are more valuable. For example, if you want to see demand, look at which areas and size of properties have got the most 'sold subject to contract' or 'let agreed' flags. Or for pricing, is the aggregate of marketed prices on property portals a better indication of market demand than historical sold prices?

The fact is there is so little volume of sales in each area, or each type of property, that it is near impossible to get an accurate handle on pricing and demand. And that's why agents will always thrive: people want a hand to hold through the uncertainty.

Even on US MLSs, properties are uploaded with such inconsistent meta data, it is very hard to compare a property side-by-side, without visiting it and seeing the facts for yourself.

Plentific, a UK challenger portal, has a feature that allows property features to be displayed side-by-side on the screen, like we used to compare PC specs in Computer Shopper magazine.

It's a lovely thought, but entirely impractical when the source of that data is Zoopla (which takes those property details from automated feeds of an agency's CRM system).

The fact is, if you're looking for a property that is freehold, you'll miss out many freehold properties as that information is inconsistently input by agents into their systems.

This is a very difficult problem to solve. Arguably, you could use Open Data to triangulate lots of data sets and find out many interesting and useful data points that are omitted by agents and property owners.

But the more interesting data is closed: like Council Tax data in the UK and tax records in the US. 

And herein lies the natural tension: this data is valuable. Why would it be given away for free?

In the UK, Royal Mail (national postal service) was privatised. There was a muted debate about the data Royal Mail would take with it.

According to this Telegraph article, the Postcode Address File (PAF) that Royal Mail owns and maintains is worth more than £0.5bn (http://www.telegraph.co.uk/news/uknews/royal-mail/9994741/Everyones-postcodes-to-be-privatised-in-Royal-Mail-flotation-despite-objections-from-Sir-Tim-Berners-Lee.html). 

To put this in perspective:

PAF - £0.5bn
Zoopla - £0.9bn
Rightmove - £2.1bn

In this vein, the Georgia MLS is reported (http://www.inman.com/2014/06/26/georgia-mls-will-provide-members-with-tax-records-from-every-county/) to be bundling local tax records into its service, for licensed Realtors to use in their everyday course of business.

Steven Sinofsky, the Product Manager behind Microsoft Windows 7 & 8 and previous editions of Microsoft Office, poses some interesting points and questions on the topic of bundling and unbundling: http://wp.me/p31nkB-ho. 

Boiled down, he says it is all about context: timing and current consumer behaviour. 

Is the timing right for open data? Or will the winners be those who control and successfully monetise proprietary data sets?