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Data driven CEO mindset for home buying

by Prashant Sachdev 31 May 2021

Articles

A lot of decisions are made based on gut feeling, intuition and shortcuts employed based on someone else's opinion or experience. This is true for many things in our life including home buying.

Let us try to think through the variety of decisions we have taken till date. And recall what gave us the confidence in taking that decision.

Where to go for college education?

Wherever we see folks similar to us go and also based on subjects “we like”

Which car should I buy?

Mostly based on economy, budget and yeah “driving pleasure”

Should I marry?

Based on how much “you love” and are committed to him / her.

If you notice your answers clearly - most if not all are based on some form of intuition, likeness or a simple straightforward approach based on what everybody sees through. We are all trained to take such decisions in this way ever since we are born.

However things have changed a lot in the past decade. Try answering these questions now

Will you watch this movie?

Let me check the IMDB review / rating.

Where should I go for a dinner date?

Let me search that on Yelp.

Should I book this hotel when traveling?

Let me confirm that based on Tripadvisor ratings and comments over there.

Notice how we answer these questions and depend a lot on data and such newer platforms. You might argue that wherever there is data we primarily depend on that initially but well it is not true. As humans we are always trained to take shortcut approaches and rely a lot on intuition.

Our famous game of baseball has data on players / games since the 1800s and some form of analytics was employed since the 1970s. But it was not until 2002 - Billy Beane transformed baseball by effectively using data analytics to reinvent Oakland A’s team by picking undervalued players who had the potential to deliver the results he needed. Billy Beane effectively showed that even though he lost valuable players like Jason Giambi, Johnny Damon, and Jason Isringhausen to the rich teams, he could go back to the drawing board - do the necessary research and even with a limited budget identify players that would help his team win consistently.

Data Driven CEO mindset of Billy Beane resulted in Oakland Athletics 20-game winning streak that broke New York Yankees American League record.

Today we hear about every other consumer internet company (Google, Amazon, Facebook, Twitter, Linkedin) leveraging this approach to data and decision making to serve their users. But do note this isn’t invented recently and since long many other companies have been relying on data to make effective decisions for their businesses. Walmart built large data warehouses and pioneered the use of data since the 1970s. UPS saved 20.4 million miles off routes in a single year by ensuring their drivers took only right turns (limit left turns).

Data Scientist has been the sexiest job of the 21st century and while we are seeing an influx of data scientists across all industry verticals including in real-estate, there is a great scope of transformation in how one employs data science to their advantage. Census, housing, and mobility data has been out there for several years but we still are facing several challenges in the real-estate industry - Inventory at record low, affordable housing to name a few.

Data-driven CEO approach (similar to Billy Beane’s method of shortlisting players) when planning to buy a home should help lessen the demand in competitive suburbs and help discover hidden gems that are a great fit for many professionals and families. The pandemic has also fueled the rise in families looking for nicer suburbs to live all over the US that fit their budget because they can now work from home and care a lot about their lifestyle and less about commuting to work. We at Nextburb, have trusted advisors on-board who try to inculcate the data-driven CEO mindset in homebuyers by asking relevant questions to families looking to move.

Interested in finding towns that are similar to Palo Alto in the bay area or Lexington in Boston but within your budget? Schedule a call with us to speak with data-driven advisors who will assist you with the research in your home buying journey.

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