Location, Inc. Releases New Kind of Real Estate Reports, With Aims to Be the Carfax of Neighborhoods
Location, Inc., a provider of online real estate research tools, launched in 2002 with the intent to objectively measure which neighborhoods are the best fit for a particular customer, based on criteria such as school quality, crime rates, home appreciation values, and the prominence of upwardly mobile singles. The housing matchmaker service has been available on the Woonsocket, RI-based company’s website, NeighborhoodScout.com, since then, to help consumers determine which pockets around the country best fit with their lifestyles. Its search engine also helps people find neighborhoods most similar to the ones they already know they like.
Last week the company launched a new service, hosted at NeighborhoodScoutReports.com, to produce neighborhood-specific documents akin to the vehicle history reports offered by the Web service Carfax. “There isn’t any comparable product for what is obviously and vastly the largest purchase for most Americans,” says Andrew Schiller, the company’s founder, CEO, and chief scientist. “The largest risk for people buying a home is rarely the condition of the house, but the location of the house.”
The aim of Location’s new product is to provide information on the surroundings of a particular house or property that has already caught your eye. “It isn’t about showing me the best neighborhoods for this criteria, but rather showing me a detailed report for the neighborhood that contains this property,” says Schiller.
He says the website’s data-crawling algorithms scan multiple, disparate sources of information to create one comprehensive report, which sells for $19.99. The reports pull data from roughly 70 sources, and use patented or patent-pending data engines built by the company’s in-house geographer-statisticians. The product is also fully available on mobile browsers. That way customers can get on-the-spot neighborhood information on a property with their iPads or iPhones when they first pass by a for-sale sign, Schiller says.
Other real estate sites such as Zillow.com track the history and value of specific homes, but Schiller says his company is looking to provide consumers with additional information on the streets and services beyond the immediate property. Homebuyers often think that they can gather enough information on where they’re looking to purchase a house by asking friends and neighbors in the area. And other data sources often provide information at a citywide level, rather than drilling down to get statistics on a particular slice of a city or town, he says.
“People thought they could just ask friends,” says Schiller. “They mistakenly thought that because they lived somewhere, they had perfect economic knowledge about their radius.” He learned this lesson the hard way himself, he says. He built a home before his company’s product came out, and later found out that the neighborhood two miles away had better schools and a lower crime rate, he says. (He later sold that home and moved to the better neighborhood.)
Schiller’s company is looking to partner with online consumer sites that host real-estate listings, like Boston.com, he says. His aim is for those listings to include a link to purchase the NeighborhoodScoutReport for the home a viewer is checking out. It will continue to offer its original search engine too, which runs around $30 a month for a subscription. The company recently closed the first part of its Series B round of funding, Schiller says. He didn’t reveal details on the financing, but Location showed up on our May under-the-radar deals list, with a $571,464 equity investment.
Schiller says he first got a taste of using statistical equations to do neighborhood matchmaking while pursuing his PhD in geography at Clark University in Worcester, MA (where he founded Location). And he often found himself checking out the neighborhoods listed in various publications as the country’s best places to live, only to find that the “semi-sterile suburban places” weren’t compatible with his self-described young hipster lifestyle. “It dawned on me at that early age that there isn’t one best place for everybody,” he says of his inspiration for his company. “We could crunch data that could find objective truth to find the best place for you.”
Schiller says he was more interested in finding which other cities resembled his native Portland, ME. So he built algorithms that quantified the similarity of his hometown to other spots across the U.S., and found good matches in cities like Portland, OR, Seattle, and Denver and Boulder, CO— “these cool, hip places that have a little bit of a redneck undercurrent” (his words, not mine). He used the equations to build the search, data synthesis, and neighborhood matching elements that now power his company’s site.
Location, which has Mapquest.com co-founder Barry Glick as its chairman, is also hoping that its detailed neighborhood scouting reports will attract commercial customers looking for the next location to set up shop. The data the engine provides could help consumer businesses determine which potential properties are located in the best areas for their target customers. Or, for companies looking to house a warehouse or distribution center, for example, placing their facilities in areas with lower crime rates could score a lower interest rate on business loans, Schiller says. And that means, if all goes well with NeighborhoodScoutReports, not just homebuyers but also expanding businesses will be getting better deals on real estate.