Tech platform provider and marketing agency MoxiWorks launched on Thursday the Home Sales Predictor, a new prediction model the company will run on a monthly basis in order to predict the number of U.S. home sales two months in advance.
By pulling data on the number of presentations created within the company’s presentation builder, MoxiPresent, and matching it against MLS sold listings data, MoxiWorks is able to quite accurately predict the number of sold homes in the next two months. By monitoring their data over the last few years, the company has determined that real estate agent activity, as demonstrated within their own presentation platform, is one of the leading indicators for home sales.
“The thing that no one is talking about in real estate is actually forward-looking, leading indicators, as opposed to lagging indicators,” York Baur, MoxiWorks CEO, told Inman. “What we saw as opportunity to do a couple of years ago is to go upstream, because the unique thing in real estate is, agents are talking to consumers every single day. We feel like we now have the data necessary to extrapolate from those actions what actually happens.”
Because the data is based on MoxiWorks’ proprietary and national MLS data, predictions will correlate to future sales on a national level, and not represent any specific regional data at this point. However, the company hopes to expand predictions to provide more regional data in the future.
Although the unusual spring the housing market saw this year as a result of COVID-19 shutdowns may have some wondering whether or not it’s futile to try and make predictions, now that the market has achieved some normalcy again, Ali Rae Lundberg, the company’s data analyst, says their forecasts have held up.
“We know that any data from roughly March-June across the board skews us away from any sort of normalcy,” Lundberg said. “But, after removing the COVID months from our regression model, our prediction for September came within 1 percent of the actual number of sold listings for September, which aligns with what we’ve seen the last few years. Predictions like these are never going to be perfect, but to be that close and so statistically significant is a big deal.”
Based on movement within MoxiPresent from August and September, the company predicts a total of 541,000 home sales during October and 534,000 home sales during November.
The company’s data pool includes presentation metrics from hundreds of thousands of agents, as well as MLS data from about 50 partner companies that are part of the MoxiCloud partner program, Baur said. (MoxiCloud is essentially the company’s data platform that connects data to popular software solutions like Docusign, Spacio, etc.) He hopes that this predictor model for home sales will be the first of a series of predictor models, including for home prices and more.
“We’re not going to rush that,” Baur added.
With the launch of the prediction model, Baur also suggested that agents can actively make an impact on inventory levels, and therefore, home sales, by educating consumers about their home value and the market.
“Brokerages and their agents are in the unique position to help create more inventory by being proactive with consumers,” Baur said. “When an agent presents to a buyer or seller, or to a consumer on the value of their home and what’s going on in the market, they are creating movement in the market. With more than 1 million presentations created using MoxiPresent, we have the data to back this up and have seen firsthand how impactful these presentations can be.”
The home sales reports will be provided as a free, open resource for the industry.
“We feel like it’s a service we owe the industry because it’s such a vacuum for this sort of thing,” Baur said.