The “Appraisal Process” requires good judgment in picking comps. USPAP (Uniform Standards of Professional Appraisal Practice) uses the word comparable 95 times. Comps MUST be important. However, it is not defined. The Appraisal of Real Estate states a comparable must be similar, competitive, and “able to be compared.” In the 14th Edition, it is used […]
Three approaches to value evolved from the scarce data of the last century. With abundant data, three predictive models have evolved. What is the difference? Approaches vs models. The difference is like looking at a cube from the side or from the top. The top gives one view. The side shows another. In fact, they […]
Bias, We Got it Handled? We got standards, we got smarts. And we have issues . . . This is the second of a series asking questions and seeking answers about bias in valuation. Part One is here. President Biden proposed to “establish a national standard for housing appraisals.” The purpose is to ensure adequate […]
Judgment vs. Data. Computer quants vs field experts. Each thinks they have a better hammer. Quants think the experts have their eyes closed. “Experts” think the quants are hammering screws. Both have sore thumbs. Better In part 2, we considered heuristic analysis which focuses on mental efficiency to help make judgments and decisions quick and […]
Reasonable reasoning please! Its not as bad as it sounds! We can figure this out. That’s what abductive reasoning means! Figure it out! The three types of reasoning go along with three types of logic: deductive, inductive, and abductive. Deductive reasoning means a general rule leads to a specific conclusion, always true; Inductive reasoning is […]
Evidence is a necessary part of any research or analysis. In a prior blog, we considered that it was a core part of EBV (Evidence Based Valuation©). We noted three basic types (or ‘support’ for a personal opinion). We have logical – “if A, then B must follow”. We have empirical – “If A, then […]
More graphs: in data science, why are they so important? Graphs provide the way for the human brain and the computer to connect. And why is that important? More Computers are really good at certain things. They can handle lots of data and can quickly carry out complex instructions (algorithms) with no mistakes, with perfect […]
Judgment vs. Data. Computer quants vs field experts. Each thinks they have a better hammer. “Experts” think the quants are hammering screws. Quants think the experts have their eyes closed. Both have sore thumbs. Judgment Here, in part 2 we will look at the field-related expert, excelling in experience and judgment. In part 3, we […]
No computer can replace my expert judgment and experience! We’ve heard words like this. And there is a contingent of “quants” who rely on a high level of competence in quantitative methods, which may include statistics, machine learning, and artificial intelligence. Each expert type has a hammer. And each is right in their own way. […]
Consumer home loan valuations serve those who pay the bill – the lender. This cost is passed on to the buyer, and the buyer usually has a right to get a ‘copy’ of the report. However, the valuation is not there to help the buyer decide whether the price is fair or a good investment. […]
Science is “systematic study through observation and experiment.” A method. But wait, there’s more! Science is both a process and an organized way of thinking. It follows some basic principles. Darn! It seems science does not care if you believe in it or not! There is process in science: There […]
Appraisals, AVMs, evaluations, Broker opinions, and “homeowner’s opinion” – valuation of any sort all have some things in common. The “new valuation modeling paradigm” is a term coined by Marv Wolverton, PhD, MAI (who authored the AI book An Introduction to Statistics for Appraisers). He created the term in a response to my peer-reviewed Appraisal […]
I first heard the word unlearning at an AI national conference. The speaker said that unlearning was as important as learning. Perhaps more so. We human beings tend to want to maintain the status-quo, unless somehow compelled to change. Change is not easy they say. Psychological inertia involves inhibiting any action, just because it causes […]
Why is the class called “Stats, Graphs, and Data Science?” It is easy to see statistics in data science, but why are graphs given importance? To answer this question, we must hear how data science sounds. Yes, it is a science, yet science includes judgment and subject-matter experience. And visualization. Data science comprises competence, computation, […]
AVMs (Automated Valuation Models) have been around for over 20 years now. Appraisals have been around for 100 years now. Why no winner? Let’s look. This is the first part in a series of coming blogs that will compare and contrast “automated” versus “opinion” valuations. Stay tuned to hear the unexpected surprise climax of this […]
