Don’t be Scared of Big Data
A careful reading of it will show home buyer preferences and changing unit popularity.
The biggest change in the way I evaluate and analyze the new housing market for clients is via big data. New home listing portal Buzzbuzzhome produces tremendous data on user preferences by tracking every click on their website. Buzzbuzzhome recently announced a partnership with Toronto-based ThinkData Works Inc., a data management platform. “New construction homes can tell us a lot about what’s happening in our communities,” said Lewis Wynne-Jones, Head of Partnerships for ThinkData. “From understanding home market trends to getting insight into up-and-coming neighbourhoods, BuzzBuzzHomes data is a game-changer for anyone who wants to understand the new home development landscape in the USA and Canada.”
Buzzbuzzhome often has the prices for a new development up on their website the same day that the project price list is released and sometimes prior to launch. With monthly updates, my firm can stay on top of preferences faster than ever before.
After presenting some of this big data at a recent event hosted by Colliers, several folks in attendance were shocked by the result. As prices have steadily increased in the downtown Toronto condo market, prospective buyers are looking at smaller and smaller units. Data from Buzzbuzzhome showed a spike in online user activity for suites from 300 square feet to 400 square feet via their website in 2019. Price growth has backed up that data, as the average price per-square-foot (psf) for suites around 300 square feet in Toronto in 2018 was $936 psf, rising to $1,416 psf in 2019, a 56 per cent annual increase.
If developers had picked up on that trend earlier, they could have programmed more studios and micro-suites instead of some of the larger product that is sitting unsold, just waiting for a new incentive to grab purchaser attention (and reduce project revenue). In some markets in Canada, things are selling so quickly, developers don’t know if they left money on the table or not. The desire to hit the sales threshold required for financing while all eyes are on your project is hard to resist, it might be weeks or even days before the next hot project hits the market and people lose interest in your offerings.
I now ask audiences to use their own data wisely, release your unit floorplans in advance of the launch of your project and let your registration list know. Review the Google analytics for your website: which plans are popular? Ask for feedback via a survey; use the wisdom of the crowds and the knowledge of the brokers that have seen thousands of plans and their clients’ reaction to them.
Look at the Google stats to see where your website traffic is coming from and how long your visitors are spending on your site. What amenities are they looking at? Perhaps you need to drop the yoga room and add a second guest suite. As the aging population trades down, they want space for visiting relatives, but since they don’t want to pay for a second or third bedroom, make sure they can lease the guest suite a couple times a year.
Put up blogs with relevant content for your users and track how much time users spend reading it: if they’re on that page for several minutes, chances are they’ve enjoyed your article or update and try to provide more of this content. Today’s buyers want transparency from developers, and they want all the information online and easy to access. The old formula of providing no details to trick users to come to your sales office so you can magically convert them into buyers isn’t the way to go.
Get to know the market and what your prospective buyers want, and you’ll make sales, make higher profits, and you’ll get more repeat customers and referrals. Don’t be scared of big data, use it wisely.