How Good is Your AVM Vendor?

We’ve devised a simple test to rate AVM vendors using criteria that is generally acknowledged as predictive of customer satisfaction. You may want to assign different scores based on you own organization’s business requirements.

What types of models does the vendor offer?

Price indexing model....................one point.
Hedonic model...............................one point.
Assessed value model.................one point.
All of the above............................ five points.
It can’t be explained...................zero points.

What types of data does the model use?

Tax assessor data.....................................................................................one point.
Publicly recorded sales transactions.....................................................one point.
Privately recorded sales transactions (e.g. MLS or loan files)..........one point.
Site-inspected property characteristic information.............................two points.
All of the above..........................................................................................five points.
Not disclosed............................................................................................zero points.

What are the vendor’s data sources?

Vendor collects their own data...........two points.
Vendor licenses from third parties......one point.
Unknown...............................................zero points.

How does the user validate the model’s accuracy and performance?

Customer testimonials..........................................................one point.
Ratings agency or investor approval.................................one point.
Through published test results...........................................one point.
All of the above.....................................................................five points.
No representations of accuracy.......................................zero points.

What kind of model testing can the vendor support?

On-site testing in your environment..........two points.
Off site batch testing......................................one point.
No test support offered..............................zero points.

What platforms and delivery capabilities does the vendor support?

Windows desktop or NT.......................................................one point.
Standard API to third-party applications...........................one point.
HTML.......................................................................................one point.
XML..........................................................................................one point.
Private labeling and redistribution rights..........................one point.
All of the above.......................................................................six points.
Requires custom platform..................................................zero points.

What training and support is available from the vendor?

On-site product training......................................................one point.
User documentation............................................................one point.
Online help text....................................................................one point.
Telephone technical support.............................................one point.
Detailed technical documentation and support.............one point.
All of the above.....................................................................six points.
No support provided.........................................................zero points.

How closely does the model match your primary marketing area?

Covers 25% or less of my market.....................................one point.
Covers from 26% to 50% of my market..........................two points.
Covers from 51% to 75% of my market.......................three points.
Covers more than 75% of my market.............................five points.

How is the user agreement structured?

Annual agreement..............................................................one point.
Monthly agreement.............................................................one point.
No commitment – pay-as-you-go.....................................one point.
Unlimited license, including site licensing.....................one point.
All of the above...................................................................five points.

What is the vendor’s market position?

Entered the market in the past 12 months...................................one point.
From one to three years of commercial market exposure........two points.
Four to five years of commercial market exposure....................three points.
More than five years of commercial market exposure...............four points.

Vendor rating:

40 points or higher............................................Best in class
30 to 40 points...................................................Solid performance
20 to 30 points...................................................Needs improvement
10 to 20 points...................................................Headed for retirement
Less than 10 points..........................................Don’t waste your time

- George Livermore


This article was previously published in the May 2001 Issue of Secondary Marketing Executive