Veros Real Estate Solutions announced it is making its proprietary home price index, VeroHPI, available for commercial use for the first time. Now lenders, secondary marketers, servicers and analysts will have direct access to information previously available only in Veros products. This information includes sophisticated analytics with a repeat sales index, which immediately improves decision-making regarding residential property price trends in markets across the country. 

VeroHPI is constructed using a methodology that is widely accepted as one of the most accurate ways to determine residential real estate price changes. These models were created nearly 15 years ago at Veros, and today they are among the core methodologies used to fuel the VeroVALUE automated valuation model (AVM). The index data provides robust trending logic, offers national coverage and is available at the CBSA (county-based statistical area) or FIPS (Federal Information Processing Standard) levels. 

“This data has never been made available for use outside of Veros’ own analytic tools and solutions,” commented Eric Fox, vice president of statistical modeling and economics for Veros. “In addition to the repeat sales models, our HPI is fueled by ‘purchase-only’ transactions. This filter offers yet another measure to ensure accuracy and clarity that can be lost if other sources of data, such as refinance appraisals, are used.” 
 
Veros’ repeat sales methodology compares two or more sales prices of the same property over a lengthy period of time to ensure that the price changes measured are as accurate as possible. Indices that simply fit a model to sales prices of a large number of sales prices over time are open to errors during periods of market shift — such as when more lower priced entry-level homes are being sold — giving the impression, for example, that a market is depreciating when it may be flat. 
“Simplistic methodologies are not good enough for today’s more complex market,” Fox said. “For a number of years we have received requests for these highly accurate indices and we’re pleased to be able to make the tool available to the industry.”

The VeroHPI data has powered the company’s proprietary analytics with extraordinary results since the company’s inception. VeroVALUE, a prime example, is consistently one of the nation’s top performing AVMs, as independently verified by multiple third-party testing entities as well as by large national lenders who perform recurring blind testing with the company on a routine basis. 

Veros also provides a unique benefit in its ability to complement the index data with its proprietary VeroFORECAST, a residential real estate market forecast with the ability to look two years into the future and provide specific market performance expectations. VeroFORECAST has proven to be the most accurate commercially available residential real estate market prediction tool over the course of nine consecutive years of due diligence documentation. 
 
“We expect the index to be adopted by the industry’s securities investors, portfolio lenders and servicing operations, as well as the numerous other groups responsible for monitoring industry trends, determining capital reserves and making quality assessments of property value on large pools of loans,” Fox said. “The ability to complement the retrospective data with the highly accurate forward-looking data in VeroFORECAST should put data-centric organizations in an ideal position to detect trends and capitalize on new opportunities.”