KISS — Keep it Simpler Science! What?! How can that be?! Einstein said “Everything should be made as simple as possible, but not simpler.” The beauty of science is that it strives to make difficult things understandable. Traditional appraisal uses four or five comparable sales. The human brain can compare and understand up to six […]
Take a sample or pick comps: different or the same? Most of us grew up first learning descriptive statistics: mean, median, standard deviation and such. Later, we learned that it was usually impossible or too expensive to get all the data, so we got a sample which seemed to be like the whole ‘population’ we […]
Data-driven is a buzz phrase. It can be useful. It can be counterproductive. “And in this corner we have . . .” It’s the appraisers versus the quants in the boxing ring. It turns out that people who are experts in a subject-matter field (appraisers for example) tend to discount the words “data-driven.” The experts […]
It’s not me, I’m not biased! Is it me, the model, or the data? A great problem with legacy appraisal is that bias is about personal bias, rather than analytical bias. USPAP (Uniform Standards of Professional Appraisal Practice) only addresses human bias. Similarly, The Appraisal of Real Estate by the Appraisal Institute only addresses analytical […]
Judgment versus science. Judgment wins! (Part I of “Data Collection”) I have heard such things as “No science formula will ever replace my experience and training.” And “no AVM (Automated Valuation Model) will ever inspect a house.” Judgment wins. Except for one problem. The market share of valuations continues down for appraisers. AVMs, ‘evaluations’, broker […]
Why should I care about statistical stuff? Appraisal says: Pick some comps, compare, reconcile, and give a number. No statistics there. Data science says let the market pick the data, predict, and provide a reliability score. Traditional appraisal and modern data science have the same goal: help make decisions by analyzing data. Statistical thinking is […]
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 […]
Misused terms: AI (Artificial Intelligence), ML (Machine Learning), makes you look smart. It makes for clever marketing. And it may be BS. The most important “algorithm” for valuers is A+B=C. Words are important. They help us understand each other and avoid wars. Marketers, in particular, tend to bandy about clever words, designed to impress you […]
“Appraisal is not an exact science” are words I used to hear a lot. This understandable view leaves much to be explained. In the USA, appraisal is an opinion of value by an appraiser. (Licensed, and when required, for “federally related transactions”.) All other types of valuations have different or no regulations. However, they are […]
Reform? What is the real problem? We know of meltdowns. We hear of bias. And we see the “American Dream” may be just a dream. So what about government? Why? And what part might appraisals play in these issues? More importantly, what keeps us from implementing solutions? Can government agencies (such as FFIEC and the […]
Science is systematic way to build and organize knowledge. What’s to fear? Science is a search for the truth. Scary . . . How can the search for truth be scary? It is especially easy to deny the results of systematic study, if one can latch on to other’s fears, perpetuated misinformation, and wishful thinking. […]
Many of you ask why we only teach courses using a data science approach to valuation. The answer is quite simple: It’s comprehensive, covering existing aspects of valuation. It sharpens the judgment involved with traditional methods. It increases usefulness, enabling appraisers to provide more than one service. Teaching only data science is also the topic […]
We talk a lot about data. The Good. The Bad. The Biased. And how wonderfully important information is. But what really matters? It can be easy to get lost in the mish-mash of talk about data. Let’s step back. Why do we care about this? We care because it is useful as an input to […]
A vary good question! As I have often contended: The problem with statistics is . . . words. Appraisal has been accused of being a “cottage industry.” Grrrr. How can this be? Here, too, part of the problem is words. We have continued to use, enforce, and teach outmoded ways and words. Ways and words […]
Why not data science? Before we talk about anything, we need to know what ‘it’ is. What is data science? First, what is science? Science is “a systematic study, by observation or experiment; by an expert in scientific method and the field of study.” And what is data? Data is anything which can be measured, […]