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Second Phase, Inc., a Richardson, Texas-based software development company, has launched a website called belowmarketvalue.com to help buyers and agents identify bargain homes.
The website automatically identifies and publishes homes in a local MLS that are priced below its median list price.
Individual listing pages reflect the most recent listing data.
A member of the company’s “preferred agent” network is offered as the primary contact while the listing agent of records’s name and brokerage is listed below the property image carousel, a characteristic of the site that may not sit well with other agents.
Agents can register to be found on the website for free, or they can pay to be a ZIP code’s featured agent.
Belowmarketvalue.com is currently active in the Dallas-Fort Worth, Texas, and has plans to expand quickly, according to Second Phase President and licensed broker, Troy G. Smith.
In an email to Inman, Smith said that the product evolved from his work with real estate investors.
“They always wanted a deal, of course. So my procedure was to put alerts in the MLS in certain areas and look out for deals. The thing is, how do you know it’s a deal?” Smith said.
His company’s software automates the multi-step process many agents go through to analyze a property’s price within its market, using in part an algorithm Smith said is not unlike Zillow’s Zestimate, called “eQuickValue.”
If a subject property comes in below the comps and tax value, it gets pushed to the public-facing website.
For the past several years Dallas-Fort Worth has been on of the nation’s busiest markets. Although in April, The Dallas News reported signs of it cooling.
Yet, in May, a study by commercial real estate giant CBRE named Dallas-Fort Worth as its No. 2 market for real estate investors, according to The Dallas Business Journal.
The website overall looks very similar to a common property search portal, except that prices are juxtaposed with estimated market values, listing timelines and a star rating based on estimated equity after purchase.
For example, a 4,117 square-foot, five-bedroom, four-bathroom home in Frisco, Texas, with an eQuickValue of $494,715 and tax value of $438,919, is listed for $429,900.
“This does not take into account that we haven’t negotiated yet. So, what I was always looking for was a good place to start,” Smith said. “You don’t have to knock on doors, send emails or post cards to pre-foreclosures because all of the properties are on the MLS. Which means they are ready to buy as soon as you see it.”
Second Phase works primarily with insurance companies, but Smith launched belowmarketvalue.com in 2016 with a small team, working off hours. It’s been getting tweaked and tested since its soft-launch.
Smith admits the website hasn’t been marketed much yet, and the market limitation is an obvious reason for its lack of nationwide attention. There have been around 50,000 unique visitors to date, he said.
Users can also search for a Preferred Agent, subscribe to “Below Market” reports, save searches and filter searches by county or by percentage below market value.
The website doesn’t have a fully fleshed out revenue model as of yet, but Smith said they are experimenting.
In an email to Inman, Smith said he is finding that non-investors have taken an interest in the website, as well.
“There is a large market for people just looking to get a good deal on their next home. A lot of people don’t mind fixing up the home if they get a great deal. So, we have started to do some marketing towards that demographic.”
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