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PriceFinder User Guide Version 2 www.pdslive.com.au www.pricefinder.com.au
The new PriceFinder (Beta) model allows users to adjust for the quality differences in properties, resulting in a much better price estimate than an automated computer model alone. Using photos from listings or Google Street View, users can compare each of the 6 shortlisted properties to the subject. PriceFinder uses a proprietary formula to match the best 6 comparables to a subject property. The final price is derived via both computer modeling estimates and user interaction. Our test results have shown that in 95% of cases the correct price is found, especially when the user is aware of the properties used in the shortlist. If a comparable sale enters the shortlist that is not suitable, a user can easily remove it. The selected property is then automatically replaced with the next best matching sale. Introduction
Users can adjust for qualitative differences in properties
Current or retrospective dates can be used
Map displays subject and all 6 comparable properties
Offers both automated & user assisted estimates
Uses Buyers agents, developers, home buyers, property professionals Perform price estimates before auctions. Pre-auction estimates Buyers agents, developers, home buyers, property professionals Compare PriceFinder estimates to asking prices. Identify potential bargains Building consultants, agents, valuers, property professionals Estimate how much value an extension or renovation can potentially add to a house instantly. Renovations Buyers agents, developers, home buyers, property professionals Get instant estimates on a site by performing what-if analysis for various unit/town-house sizes and the potential value of each. Development sites Lenders and brokers Quickly validate a purchase price before submitting the loan application. Check mortgage applications Mortgage brokers, real estate agents, buyers agents and valuers Subscribers can offer a range of free or paid services to attract and retain customers using PriceFinder. Customer services Buyers agents, developers, home buyers, property professionals Ideal tool for prospective buyers to compare a listing price and PriceFinder estimate, as well as review the potential gains from renovations. Pre purchase Valuers, lenders, mortgage insurers, brokers Allows lenders and others in the mortgage process to enter retrospective dates. Instant retrospective estimates Real estate agents Convenient tool to support the CMA process. Support CMAs Real estate agents To ensure asking prices are realistic, PriceFinder can be used by agents as required when consulting with vendors. Find optimal listing prices Valuers, lenders, mortgage insurers, brokers Offers a powerful user assisted AVM for lenders and valuers. Desktop valuations Lenders, mortgage insurers, brokers, valuers Ideal tool for lenders to perform instant checks on all valuations (including 3 rd party AVMs) without additional expense. Quality control checks Potential Users Benefit Application
Step 1 – Find A Subject Property
Go to Property Search tab
Enter address then ‘Go’
Click on the correct address once returned
Step 2 – Go to PriceFinder
You will find the PriceFinder window on the lower left hand side of the Property Report
Click ‘Go’ to run the PriceFinder model
Step 3 – Refine Estimate
Click ‘Refine PriceFinder Estimate’. This will open up the full features of PriceFinder
Step 4 – Confirm the property details are correct You can also change the date to perform retrospective price estimates.
Step 5 – Compare the properties
On the Comparable Sales tab, you can adjust each of the 6 sliders.
This process allows you to compare the quality of the comparable sale to the subject property.
The system has already adjusted for size differences, all you need to compare is the overall quality and street appeal of each property to the subject.
If a comparable is not suitable, click ‘Remove and replace’.
Step 6 – View the map
The Summary Window A standard range of warnings are presented in PriceFinder. Warnings will vary according to the location, property type and value estimate. Warnings By default, this is the current date. Users may set this to a retrospective date within the last 10 years. Photos will only reflect current period. Date Of Estimate This is the systematic best estimate for this property using the final 6 properties and the comparison to subject settings as entered by the user. PriceFinder Estimate The larger the range of values from lowest to highest price, the larger the probable range will appear. Probable Range This is the starting estimate using the computer generated shortlist of 6 comparable properties all set as ‘comparable’ to the subject. Estimate Bedroom, bathroom and car space count. Editable by user. Icon display Total land area. Applicable to houses only. Area House or Unit For Townhouses enter Units. Type Subject property address. Address Description Display
The Property Details Tab Users can update or change property details. If the subject property details are available in our database, we can return an initial result automatically. Users should always check the data describing the property for optimal results. PriceFinder also offers a powerful tool for estimating potential value changes from renovations. By adding a bedroom and bathroom, users can perform a ‘what-if’ scenario analysis. If the condition of the property is set to improve after the renovation, you can compare the property more favorably to the final 6 matching comparables.
The Property Details Tab Total off street car spaces. It is recommended to enter a maximum of 4 car spaces. Keep the subject property value within the min/max range of the comparables. For example, if the maximum parking count from the comparables is 2 yet the subject value is 3, it should enter the model as 2 for optimal results. Parking Spaces Total bathrooms. It is recommended to keep the subject property value within the min/max range of the comparables. For example, if the maximum bathroom count from the comparables is 2 yet the subject value is 3, it should enter the model as 2 for optimal results. Bathroom Count Total bedrooms. It is recommended to keep the subject property value within the min/max range of the comparables. For example, if the maximum bedroom count from the comparables is 3 yet the subject value is 4, it should enter the model as 3 for optimal results. Bedroom Count Total land area. Applicable to Houses only. Users may adjust this value. Property Area House or Unit Property Type User defined date of valuation estimate. Valuation date Description Display
The Comparable Sales Tab The computer calculates the best matching comparable sales according to a range of variables including distance to the subject, time since last sold, land size, bedroom count, bathroom count, parking spaces and street location. To remove a property Simply tick the box to the right of the comparable property. It will be automatically replaced with the next best matching sale. To add your own comparable property (next release) Select the Add Comparable sale at the bottom of the page. Any manually entered comparable will always appear the first property in the shortlist. View images A mouse-over on the main image will display all available photos.
Map You can select any one of 4 map displays as well as zoom in or out. Each of the 6 comparables and the subject property are displayed.
Troubleshooting A comparable sale has entered from another suburb or location that is not really suited Users can change the attribute details via the Property Details tab. The property details returned are incorrect The initial automated result is based on what the computer believes are the best matching 6 comparable sales, all set as ‘Same’ compared to the subject property in terms of quality and appeal. To optimize the estimate, click the ‘Refine PriceFinder Estimate’ button. Remove any sales that you don’t think should be in the final list and adjust the comparison to subject for each of the final 6 properties. I don’t agree with the result Check the subject property has attributes entered (bedroom, bathroom and parking). If these values are null, enter the correct values and press go. No price estimate is returned Likely Resolution Problem
Frequently Asked Questions Both listings photos and Street View images should account for more than 80% of properties. In cases where a property is shortlisted but does not return a photo, users may either a) rely on an aerial view of the property, b) remove it and check if the next property returns a photo or c) drive past the property and check directly, which is always recommended for optimal results. Another alternative to using a photo image is to assume it is the same comparison as another property if the sale price is similar. For example,: Property 1 sold for $450k and was ‘inferior’ using an available photo. Property 3 sold for $440k but did not display a photo. ‘Inferior’ was assumed as no alternative available. What if a photo is not displayed? Use of PriceFinder for a select region is unlimited. Users may access properties outside that region may do so for a small transactional fee. How many times can a pdslive subscriber use PriceFinder? If your final 6 comparable sales include at least 1 or 2 similar properties, it should work well. If all 6 property comparisons are positioned to the extreme left (or right) the results will be less accurate than it would with 1 or 2 comparables with the ‘same’ rating. Optimal results are generally found when we have 2 properties with a ‘Same’ ranking. How well does PriceFinder work for prestige property or run down properties? No. You can estimate the value of a property based on it’s comparison to normal sales only. Does PriceFinder allow for development approvals or other land-uses? Listings photos and Street View photos offer a convenient way to compare properties from your office or home, especially when internal images are available. For optimal results, physical inspections will allow the user to know first hand how each of the sales compare to the subject. How do I know for certain how a property compares? If a comparable property has less street appeal or is in worse condition than the subject, you move the slider to towards ‘Worse’. The same applies if the comparable sale is a better quality property than the subject, moving the slider to the right. This process creates an entirely new and unique computer model for every change you make. It is important to note that you are only comparing on the quality differences between the properties and not comparing on size differences. The computer model will automatically adjust for differences in terms of land size, street type, bedroom, bathroom and parking. How does Comparison to Subject work? PriceFinder is included free within your subscription area. You can use it as many times as you like. How much does each PriceFinder transaction cost? Answer Question
Frequently Asked Questions It is a computer generated estimate only and should be used as a starting point for professional market analysis or as a general guide. We suggest you use a professional valuer before making any investment decisions. Can I rely on the PriceFinder estimate? The system is best for standard metro properties. It generally works best for block sizes up to 1500 m2, with optimal results achieved only when at least 1 other property is returned with a similar land size. Feel free to try it on larger blocks in metro areas and judge its performance for yourself. How well does PriceFinder account for very small and large land sizes? The system will return properties that are located reasonably close to the subject property that have sold within recent months. There are 2 situations that a user must adjust for: a) when the subject has views and the comparable sales do not, and b) when the subject does not have views but one or more of the comparables does. In the first case, you may opt to add your own comparable sale if you have one to enter that you know has views and is comparable. Alternatively, you can adjust the comparables to ‘Worse’ than the subject. For the second case, it is usually best to remove and replace the one or two comparables that have views and adjust accordingly. Google Street View offers an excellent tool for checking views, proximity to parks etc. Does PriceFinder adjust for views?
Advanced Topic 1 – Developer Sites For property developers seeking a convenient way to estimate potential prices from a particular site, PriceFinder offers ‘what-if’ analysis tools. Using the Property Details tab, enter UNITS (if the development is intended to be a multiple dwelling unit) and add the total number of bedrooms, bathrooms and parking spaces. As the complex will be new, once the comparable sales are returned, look to have at least 2 new units in the final 6, which will be set as ‘same’. Older units in the final 6 will then be set as ‘Worse’.
Advanced Topic 2 – Renovations and extensions PriceFinder can be used to provide estimates of the added value from capital expenditure on houses. One of the key advantages PriceFinder offers is the ability to not simply adjust for the qualitative differences (e.g. an extra bedroom and bathroom), but also the quality improvements resulting from the renovation. Once the final 6 sales are returned, a user can then compare each property treating the subject property as if completed. Using photos of comparable houses, you can judge the level and finish of the renovation and compare accordingly for optimal results. Although PriceFinder is only an estimation tool, it offers home buyers and home owners a convenient way to identify how much value may be unlocked from a property and how to optimize a budget.