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[In The Media] Data Minefield: Knowing Its Limitations

Yesterday, Newsday ran nearly a full page story [1] with my photo on the first page (different from the print version) of their business section discussing the vast array of housing information out there. The reporter’s article idea originated last week when I was interviewed for the release [2] of the Prudential Douglas Elliman Long Island/Queen Market Overview [3] I prepare and my plans to expand coverage and separate these two market areas.

Housing and mortgage reports are barometers of the market, but may not necessarily portray a complete picture. For example, one report may have higher numbers while another might not cover certain sales.

In other words, the size and quality of the data set defines the markets a report should cover. “Cart before the horse” so to speak.

Experts like Miller Samuel CEO Jonathan Miller say the full picture is in knowing the limits of the data

Manhattan-based appraiser Jonathan Miller bases his quarterly sales reports on numbers from the MLS, but he said he noticed a year ago that the records were a few thousand sales shorter for Queens than those in New York City’s property records.

I found the following comment by LIBOR puzzling because I was not criticizing their quality whatsoever. In fact, the quality of their information is excellent.

The Long Island Board of Realtors disputed the discrepancy, saying it compiles data recorded by brokers.

The point I was making is that by definition, MLS data in any market is a subset of the entire market. Their data set may represent nearly all sales or a small portion of sales. Their data set may serve as a proxy for the entire market or it may not. If an analyst has the means to collect data in excess of the quantity available from a local MLS, it only serves to benefit market participants.