This data download from the Census, showing where U.S. population growth changed the most, year over year in 2016, underscores a riddle that is the core real estate. Check it out.
Decisions in real estate draw from relied-upon data, tons and tons of it. Those decisions involve investment, design, construction and engineering, purchasing, marketing, customer care and handling. etc.
Raw data, such as population estimates showing growth or decline in Census-defined metro areas, has, through the years, supported massive capital resource commitment, product and community design direction, and scores of well-conceived customer segmentation tactics and strategies–all sound on paper, but which have tended to bump hard up against messier realities of how people make housing decisions based on what resources they can put into play now and in the future.
The critical role of data in making smarter, real-world assessments and developing more predictably precise and effective game plans was at the core of our recent Housing Leadership Summit in Southern California, themed Build Measure Learn.
What we got a glimpse of as our event scoped across home building and residential development’s amalgam of disciplines and areas of expertise is that, in instance after instance, relied-upon data and reliable data are two entirely separate animals.
For instance, from the Census’ population estimates, one could hardly hope to glean insight of the kind Wall Street Journal staffers Janet Adamy and Paul Overberg offer in their analysis, “Rural America is the New ‘Inner City,'” a kind of data treatise on the Hillbilly Elegy phenomenon that has turned America’s economic backdrop upside down and backwards over the past several decades. Adamy and Overberg write about how inner cities, once the bane of America’s economic existence, and rural exurban areas, once the healthy “bread basket of America,” have swapped roles in many ways:
Wall Street Journal analysis shows that by many key measures of socioeconomic well-being, those charts have flipped. In terms of poverty, college attainment, teenage births, divorce, death rates from heart disease and cancer, reliance on federal disability insurance and male labor-force participation, rural counties now rank the worst among the four major U.S. population groupings (the others are big cities, suburbs and medium or small metro areas).
This is one example of how long relied-upon data that has underpinned big time material decisions in real estate can not be considered reliable when it comes to making resource allocation and deployment decisions that make sense in today’s complex dynamic of the ever-new geography of jobs, well-being, education, and economic promise.
Fortunately, as we heard repeatedly during our Build Measure Learn sessions at HLS earlier this month, long-relied-upon data is no longer all we have to rely on to make the kinds of sounder, more predictably accurate, and higher-reward decisions and plans in real estate.
That’s because, in addition to the survey based Census tools that have been the basis and raw material for most statistical assumptions, there are other data sources, sources that specifically spring from actual, on-the-ground, real-world people behavior, rather than a sample of respondents’ answers to survey questions.
An enlightened and compelling proponent of the potential use of this new data is Reach Advisors founder and principal James Chung, whose take is that less wrong-headed decisions, investments, designs, marketing messages, and community plans will occur when builders and developers and their investment partners start putting fresher, more behavior-oriented knowledge bases to use, underlying their assumptions and strategy.
We’re honored to announced that James Chung has agreed to participate with us as one of our five “deans” for the next iteration of our Hive in-person event, Trust and Transformation: How Innovation Works, scheduled for Dec. 6 and Dec. 7, at the Intercontinental Los Angeles Downtown.
James has a disruptive take on the role data plays, and the exact nature of the data that will inform smarter real estate decision-making. Relied-upon and reliable can mean the same thing after all.
