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Blending AVMs for greater accuracy

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"Cascading" is the latest word in automated valuation model technology. Cascading AVMs, similar in theory to blended credit reports, poke around at different AVMs, data sets and other information to come up with what supporters say is a more accurate home valuation. As the technology becomes increasingly sophisticated and accurate, it lends more credibility to AVMs and could further lessen dependence on traditional appraisers. "No single AVM gives the best answer all the time, in the minds of many," said Ben Graboske, VP and chief technology officer at First American Real Estate Solutions. "The thought behind the cascade was: let's pull multiple AVMs." The idea might sound simple enough, but the methodology used is much more complicated. Introduced several years ago, cascading AVMs initially relied on the simple approach of averaging several AVM results to come up with a valuation. Now, cascading AVMs such as First American's Vector employ a complex set of rules to come up with an ac...