CoStar Market Analytics now makes use of a technology called collaborative filtering and Apartments.com search data to produce comp sets driven by the marketplace. The way it works: comp sets populate based on other like-communities Apartments.com users looked at when also looking at the subject property.
To demonstrate the power of this new technology, take a look at the gold property marker below in San Diego:
If we looked at comparable communities within the neighborhood (Rancho Bernardo), our comp set would include those markers within the red outline:
Likewise, we could use a geographical radius to find our comps:
But the problem with geographical filters is that they’re somewhat artificial. A community just outside a certain neighborhood could compete with communities inside a neighborhood. Likewise, who’s to say what geographical radius is appropriate? One mile? Three miles?
When we use Apartments.com search data, the comp sets consists of the communities with red markers:
As it turns out, renters looking at the subject community aren’t necessarily looking for nearby communities. The unifying trend for these apartments is easy access to Interstate15.
This new feature is a great tool for landlords and property managers to find competitors they might be unaware of, and ensure they set rents competitively.