Torii Homes and RealReports co-founder, James Rogers, joined Storii Time to talk about RealReports, the AI-powered property report that’s making it easier for homeowners and agents to learn about their properties.
James: Chaos. So that’s mostly what it feels like.
Saad: Like the combination of family, work, everything, I’m guessing.
James: Oh, yeah. Well, as you guys know, I have three very young children. So I have to say even if I had no job, I think my life would be chaos. Whether or not I was managing it, I don’t know. But, yes.
James: I think between that and work being something of nonstop, it’s chaos all the time.
Saad: Well, all good things, though. Yeah.
James: Yes. Yeah, dude.
Mike: Managed Chaos is great. It’s invigorating. It’s the greatest. I don’t know your situation, James.
James: It’s good.
MikeL First-person-wise, I do love managed chaos as a general rule.
James: I’ve said many a time that I’d rather be busy than bored. Sometimes I think I could be a little bored once in a while, but, you know, I like having a lot going on.
Saad: Is it funny, though, that you like, the moment you get bored and you’re like, this is nice for, like, two seconds, and then, like, you just can’t wait to get back on the horse for something.
James: Oh, yeah.
Saad: Right?
James: I’ll never forget. So before I started Torii…Julia, who for anybody who doesn’t know, my wife and I, we quit our jobs. I sold my house, and we took a couple of months off, which included a road trip around the country, and we did some some other travel as well. But it did not take long before I was like…I need to work. I was like…my mind just started spinning. So, yes, I can certainly relate.
Mike: Yeah, man. You’re a problem solver, which leads us here.
James: Doing my best.
Mike: Obviously, the start of Torii…we’re here for RealReports. but James founded multiple companies and we’re here as a result. Let’s start. Let’s dig in on RealReports.
Mike: We got a half hour. Let’s start with, because you have always been focused on the data aspect of the real estate industry and bringing it out of more ancient times to the present day…Let’s get your first thoughts on RealReports and basically, like, what is going on now?
Mike: Like, where are you taking this company? What problem are you solving, at the moment with it?
James: Yeah. Well, I know that this is less about Torii, but I think it’s important to share some context for the hisTorii because, yeah, I think to your point about that I’ve always been excited about data, especially in the real estate space. And a big part of why we started with Torii was you guys know the story, but my story, which the quick and dirty version of it is…we were buying a house and our agent was not helpful.
James: I ended up without electricity at a home in the mountains in New Hampshire in the middle of the winter, and, you know, ended up being quite a memorable night trying to keep a house from freezing with a campfire and having a propane stove and lanterns and bottled water and whatnot. But it was just it was really frustrating experience when, in that case, we did a lot of the work and ended up really not getting help and felt you know, and and feeling stuck that we started Torii to change that and and bring data and tech, but also with, like, a strong human touch and amazing agents because, obviously, there are a lot of those out there to bring that together.
James: And data was a big part of that too, to say, look, you know, we’re gonna empower agents. Agents are so good at so many things, but let’s empower them with more technology. And I think some of that ended up evolving into real RealReports with, you know, a related but similar story where, once again, my wife and I were buying a house, this time in California, and I ended up getting rejected by 10 insurance companies for wildfire risk. I didn’t buy that home. I live back in New Hampshire now, but it was a real shock.
James: And that was wow. You know, here I knew how real estate worked. As I was working with Torii, and I knew how the transaction worked. I knew a lot about real estate data, but I just didn’t have the right stuff in front of me at the right time. And in that case, I almost lost a massive deposit on this home.
James: Fortunately, because I work in a space, I was able to get out of it. But, you know, 1. it was just a really scary, jarring experience, but it really led me to say, we need to fix that. 2.We need to make it so that whatever question somebody has because, you know, if you’re buying a home in Boston, wildfire risk is not one of your top priorities in evaluating a home. But there are a lot of other things that might be.
James: And a lot of times, those are just hard, you know, whatever that question you have may be, it’s a lot of them…it’s just hard to answer it.
James: And we really set out to be able to answer any question that somebody has about any property in The United States in seconds. Now, we make that available to real estate agents who share it with their consumers. So if you are interested in getting one, you can go talk to somebody like you guys, get whowho is able to provide you the RealReport.
James: But it’s a great way to work with your agent to be able to learn anything about a property in basically real time without having to go dig around town hall or make phone calls or go to 10 or 20 different websites to piece that information together.
Mike: So yeah. Let’s get into that. Like, how are you gathering that information, and how are you evaluating the accuracy of said information? Like, how much into the weeds do you get from multiple sources of that information?
James: Yeah. That is a great question. So, we get data from over 60 different places. And some of those places get data from thousands of places. So in effect, I mean, the data is coming from a lot of different places.
James: But a big part of what the technology does is not only deliver that in a nice package. I mean, I didn’t say this before, but probably the easiest way to think about it is like CARFAX for homes. I mean, you’re sitting in a car that you may have pulled a CARFAX for before you bought it, and I think most people are familiar with that idea.
James: We think about it that way just because I think it puts people in the right frame of mind. It’s like, oh, we have that for cars, why don’t we have that for houses. So we really try to build this into a comprehensive version of that. But in doing so, obviously, it means data.
James: We need data from a lot of different places. In our case, that and that’s we’ve lost count.
00:06:11 [Speaker 1]
I mean, there’s so many different data sources, but a lot of what the technology does is make sure that that data is reliable, and some of that means redundancy.
James: For you guys, you know how important this is. But to the person, just somebody who doesn’t think about real estate every day or maybe doesn’t work at it, they might think, oh, square footage? Like, that’s an obvious number. That should be an agreed upon value for every home. Like, why is there a dispute? You might look up four different sources, and it might say four different square footages for the same property.
James: We do a lot on our side to to cure that data, to make sure it’s redundant, to make sure there’s agreement. We have a really complex system on the back end that that ranks providers and says…Okay, for this type of data, who do we want this from? If they fail and they don’t have it, where do we get it from after that? And waterfall that. So, there’s a lot of work on the back end to make sure that before that shows up in this nice, pretty package where it’s really usable, we make sure that it’s reliable beforehand.
James: Now, I think it’s important to note that, like I said, you get this through your real estate agent. So before a consumer sees it, the real estate agent sees it. And what that means is the real estate agent gets an opportunity to say, I’m gonna add my own expertise, my own color on top of this. I’m gonna add notes. I’m gonna reorder it. I’m gonna highlight the things that are really important, that I know are important to you, because I don’t know that agent’s client, but the agent does. So they get to help understand that property and be the leading voice there.
James: But in our case, we wanna empower the agent to be able to tell that story.
Saad: I have a couple questions around that, James.
Mike: Saad, real quick. What’s up to Azimi Mohammed, Sheed? Thanks for joining. Laz, good to see you. Hey, Rob.
Saad: You you know Azimi Mohammed is Esa. Right? I did.
Mike: Now I did. Hey, Esa.
Saad: What’s up, everybody? Thanks for joining.
James: Hey, Rob.
Saad: So, James, so real quick on so, obviously, you know, 60 different sources, thousands effectively of different sources within those sources. Right? So, there’s tons of information that comes in. Naturally, there’s gonna be stuff like they’re like the specs of the property and permits and and, like, you know, zoning and things like that. Are there, when you say CARFAX for homes, like, what would you say are some of the unique things that come in this report that, like, you really can’t find anywhere else.
James: Well, as you can imagine, I’ve shown a RealReport to an awful lot of people, and I always get a laugh when people laugh at the end of it because, you know, I’ll go through it, and it’s a very, very long report. We try to make it a nice package, but you guys have seen an awful lot of them.
James: You go through it and you realize, oh, there’s there’s, like, an overwhelming amount of data in here. So I get asked questions like that, and I think it’s a hard question to answer because I think what’s most interesting depends on your use case. In my example, in California, I couldn’t do wildfire insurance. So I think in that case, we have a lot of risk and climate-related data. So I guess this is in a flood zone. Is there a wetland in the backyard? Which some of those are very relevant to New England as well. I mean, a lot of people don’t wanna live where a wetland is five feet from their backyard.
Saad: Yeah. I had one last year.
James: Yeah. So, I mean, when you know? And, Mike, you know, we know a story of somebody who wanted to build a pool. And I was like, well, actually, that’s too close to wetland. Turns out that now you got a product where you click one button and you’re like, okay. There’s the wetland. There’s the national forest nearby because I wanna be able to recreate there. And turns out this abuts 3,000 acres of conservation land.
James: But other times, it’s to your example, is the permit history. I wanna know when they replaced the roof. I wanna know, you know, what is the condition of this property. Sometimes you wanna know maybe you’re an investor, and there’s data like short term mental data to figure out what are the comps for that nearby because that’s again, real estate agents, turns out there’s a lot of data like that real estate agents may have access to to figure out if you want to go put this on Airbnb, how does that compare? But then data’s kind of hard to find and then we’ll actually have comps for that to say how much you expect to rent this for an Airbnb, not just how much you rent this for monthly if you have a twelve-month lease to somebody, but how much could you rent it for nightly on Airbnb?
James: So it really depends on your use case, but we try to make it very comprehensive. Sometimes you wanna know where the closest grocery store is that does pick up and delivery. And it’s like so, you know, that that data is in there. And one of the things that we’ve done on top of that is we understand that can be an overwhelming amount of data, but we built a really cool AI copilot, we call it Aiden. Or instead of even having a scroll through the report to find it, which of course you can do, and we try to make that easy, now you actually just ask a question. Now when you ask a question, Aiden goes and finds the answer in the report for you. And it’s important to note, it’s not gonna make up an answer. It’s using the data that’s in the report, but it saves you time because it’s pulling from all those different sections to say, alright. Well, if you did wanna short-term rent this, first, I need to look at the zoning data to figure out, are you allowed to do that? And now I need to figure out, alright, is it worth it in that area? And then combine all these different pieces to say, alright.
James: Well, and also, like, let’s compare that to the weather in January. What’s going on around there? Are people actually gonna rent that and for how much and when?
Mike: Yeah. That is fantastic to have…to be hyper specific like that.
Mike: This is not a RealReports specific question. This is more in a general, like, if you’re looking at a Zestimate, Redfin estimate in RealReports, I don’t think anyone really delves into, like, where does that number come from? What are the inputs that this particular algorithm is sourcing from, to give that and and how it adjusts? So could you get, like do you have knowledge or insight into that? Basically, how is that constructed? Because it’s a math problem.
James: In in my world, we call those ABMs. It’s an automated valuation model. And it’s a great question, Mike, but the real answer is none of those companies will tell you. And it’s with good reason. It’s because if they told you, then somebody else will just go build the exact same thing, and they’d come up with a similar number as their valuation.
James: But all those are proprietary algorithms where they say, well, here’s what we say that this home is worth $612,000. Somebody else says it’s worth 640. I mean, they generally aren’t gonna tell you. I can tell you a lot of the generalized inputs. It’s recent sales and area data
James: Of course. The market’s performing, and what does this home look like. But as far as specifics, it is generally gonna be proprietary. Now our approach to that is twofold.
James: One, the first thing that when an agent uses a real report, when they add when they create it for their client, first thing we do is ask them what their their opinion evaluation is. Because you guys know this. You probably sold the home next door. I mean, you know the neighborhood better than any computer is ever going to know. I don’t care how good the computer is. You as an agent know what, you know. You already know the fabric of that neighborhood and you know that someone down the hall in this multifamily building just sold or wants to sell next month. The computer doesn’t know that.
James: So, the first thing we do is ask the agent what they think, because it’s our opinion that the agent is the real expert. But what we do as soon as you scroll down for past that in a real world, we might show you eight or 10 different valuations. We don’t actually make one ourselves. You know, what we do is say, agent, what do you think? You’re the expert. But we support that with eight or 10 different valuations from various sources that we work with because and we want the we wanna really empower that agent to say, like, I think it’s worth $635,000 be and here’s why.And I’m gonna add my color to that and I’m gonna explain to you why I think that’s true. I used these comps, I did this research for you.
James: But let’s look at what eight different computers thought to compare that and say, look, there is a really tight clustering around that. Here’s why I think it’s a little bit lower than that because the market or maybe I think it’s higher because you renovated that bathroom and nobody else knows about that yet. It is really the nexus of the agent’s expertise with as much data as you can empower them with.
Mike: Awesome. Great. Great answer. And I have thought about this for some time of is a Zestimate or a RedFin for a number. If it’s seen by the public enough, is it almost a self-fulfilling prophecy sometimes? Could you be so in a competitive market, could you as a buyer be so influenced to expect it to be up to that number? It’s might not be an answer, but it’s just something that I think about.
James: social psychology. Yeah. I think, unfortunately, that’s probably more true than most people would want to think of it. So, you know, I think that’s why we look. You guys know I’m a licensed broker myself. We’ve all dealt with the question of, well, what about the Zestimate? You know, where somebody’s saying hang on….We’ve all dealt with this time and again, where it’s based on that, you know, your own expertise, you say, you know, we should really list this home at $699. But then somebody said, well, the Zestimate says it’s worth $740. And then somebody said, well, okay. You know, and sometimes it’s the Zestimate says it’s worth $800. So you say, alright. Fine. We’ll list it $775 and then turns out it sells for $695.
James: And it’s like, oh, yeah. It turns out the agent knows the market because they sold the home next door, and they were right. Watch the MLS, and they see what’s happening. And they they just know better. But to your point, I think it’s self-fulfilling insofar as if understandably, most people have a very different job than we all do. They don’t think about real estate all the time. They think about real estate when it’s most important to them… other than maybe scrolling when they’re killing time on Zillow or whatever. But they, you know, they think about it because, like, I need to buy a home right now. And so now I’m gonna get serious about that. I’m gonna sell my home and how much equity do I have?
James: That’s when they think about it most, which understandably is an emotional process. If you work in this job, it becomes less emotional. So if you’re thinking about it unemotionally, you just look at the data and say, look, I this is most likely based on my expertise what this is worth. And I think it’s a lot easier to think about it that way, but if somebody doesn’t have that expertise because why would they? Then the easiest number for them to see is the Zestimate or the Redfin Estimate. But that’s why they need to work with a real estate agent to understand that those are just numbers. Like, they might be directionally correct, but it doesn’t mean it’s the actual selling price of the home because that’s what the market will determine.
Saad: Mike, to your question, it’s public. I think when people think about that, when people think about like, oh, everybody can see that number, like that kind of does something to your brain. Like anybody who’s interested in your property or other people that might be interested in a property that you’re interested in, they can quickly just look up the address and the first thing that pops up is this is a Zillow. Right?
Saad: So, you click on that link and you’re gonna see that number. So, naturally it’s gonna do something in terms of the neurons in your brain to, to like, to like kind of make you feel a certain way. I definitely think that there’s some, like in psychological impact that is as wrong as those numbers often are. There’s a psychological impact.
James: It’s very common in behavioral economics, but anchoring. You know, like somebody sees that and that if they see, even if this home is worth 700, as soon as they see a number that says 500, it says 900, then they’re like, well, I saw that number said in their head, that’s their base point. And now trying to get them back to 700, which might be the right number, is even that much harder because they’ve been anchored at something different. Yes.
James: But, again, I do think that that’s when it’s really important to work with somebody that thinks about this all day long every day and has done it a whole lot to say, alright. Help me unanchor from that point to figure out what reality is.
Saad: I wanna share quickly, so a couple of things. One, a personal story, like, you know, I used, so, obviously, I work in this industry, but I don’t work in Texas. So, like, obviously, I have access to tons of data in Massachusetts and what have you. But even in Massachusetts, I’ve, you know, I’ve had a lot of clients who’ve leveraged RealReports.
Saad: But, as an investor, I was looking at properties in Texas, and a RealReport data at the very top is evaluation data. That information was super powerful for me when it came to, evaluate evaluating as an investor, whether I was getting a good deal or not, on a property.
Saad: So I think if this is not just if you’re a buyer or a seller, like, even as something as simple, like, I mean, you know, getting a deal is, like, paramount as an investor. It probably is the most important thing you think about. So just simply for that purpose I mean, obviously, there’s a lot more, but simply for that purpose, it was extremely powerful for me and my business partner as we were trying to evaluate that particular transaction a couple years ago.
Saad: So, RealReports was just started kind of shipping out these reports and now it’s gotten even more powerful.
James: So Saad since you shared that story with me before, if I recall correctly, I think you beat 16 or 17 other offers and actually got that property as an investment.
Saad: Yeah. And it was in that. We went above the asking price. It was not properly listed at all, but there was a lot going on with that property, which is a story for another day.
Saad: I mean, there were sixteen, seventeen other offers and, yeah, we were the seventeenth. They didn’t have access to that data. And that was the one reason we decided to that data that we saw was the those the reason that we decided to up our offer to make sure that we won.
Saad: And now fast forward two years later, just to talk real numbers, each of those properties that we purchased is worth $220,000 more than, each individually is with $220,000 more than what we paid for.
James: That’s awesome. Good for you.
Mike: No way. That’s amazing.
Saad: So, Yeah. So I mean, like, again that was what we needed. That was the data that we needed to push us to that level. So I highly recommend, you know, everybody use it, but I mean, I think if you’re an investor, there’s special information there, especially since, for us, it was like it wasn’t a zestimate. It was like real data from multiple different sources, and it helped us really inform our strategy in a very competitive situation.
Saad: One other thing I wanna mention too…I get asked a lot, and Mike, I know you do too, about rentals. And maybe, James, you can help explain where you get that data from. That’s data people always wonder, oh, if I do this to my house, like, my particular house. Right? How is that gonna impact ROI? Can you explain, like, number one, is that something that, like, a lot of subscribers and agents are using and asking about? Are you getting feedback on that one?
Saad: I would imagine the answer is yes, but I’m just curious, like, what kind of feedback you’re getting on that one? And also, any kind of, like, pulling behind the curtain, like, looking behind the curtain, I should say, like, how does that even work?
James: Well, so a lot of questions all in one. So, first of all, I would say, yes. People use it, and they’re excited about it. I would say how what goes into it is some mix of market data and analysis across various properties that are similar, and figuring out if they redid the kitchen, how much did that value go up when they did that? So there are a lot of different data sources that can go into that. And, you know, I when you ask, do people use it? This is sort of what I was saying before. I think it really depends on your use case because there are gonna be some people, they pull a report, they’re like, I’m this is a brand new home. I don’t care about the renovation potential.
James: So is it used every time? No. Of course not. But when you need it, you really need it.
James: I’m buying a flip, and I, you know, I’m gonna gut this thing. I need to under or or maybe it’s polish it up a little bit and fix out figure out which of these projects might add enough value for this to be worth it. So you know, the idea is when you need that answer, it is available. Now I would encourage, you know, and one that people may not know is that Mike and Saad and the whole team at Torii, they can always provide a RealReport to every one of their clients. So if you are a client that is working with you guys and already want to see one of these, just ask. Or, you know, maybe you’re somebody who’s thinking about who you should work with. I mean, you know, this is a team that really does care about data and and makes you know, and wants to help their clients make empowered decisions. So whether that’s renovating a home or it’s thinking about a rental or it’s thinking about, like, these are the permanent history or you need you wanna look at eight or 10 valuations to measure that against. I know you guys care about data, so I would encourage anybody to ask when they need that.
Mike: James, is it a living report now? I know that there is some effort to get it. Like, does it update over months or years?
James: It doesn’t for an important reason. I mean, we want you to be able to have a point-in-time report. So you could actually go get another report, and it’s partly because you don’t want stale data. When you go click and you type in an address and click to get a RealReport, we’ll go check, you know, I said 60, but really because some of those, it’s much more. We might go hit a hundred, two hundred different things all at once, right, when you type that in. So we want it to be as fresh and as current as possible. Now if you go do that again, it will redo that.
James: So you can compare those and say, well, here’s my report on this home from six months ago. And that’s another thing I would say, if you’re somebody listening and maybe you work with these guys and you actually you you already own your home. I mean, you’re thinking about selling, or if you just wanna learn more about it, then I was even my own house, I always find it really interesting to look at the report. There’s so many things in building this product with our team, I’ve learned so much about my own home, the area. And I’m like, oh, I didn’t know that that part of the land did this or that, oh, that’s interesting that somebody got rejected for a permit a while ago, and now I know the story around that.
James: I’d say even if you’re thinking about selling a home or or or maybe it’s a five years from now thing. To your point, it’s kinda interesting when you say, well, here’s the real report from a year ago, and here’s the real report of that same property from now, and you can look at them side by side. That actually reminds me of something that we need to get back to, planning out is an annual RealReport for our clients.
Saad: So I’m gonna put that down.
Mike: I thought you were gonna say have a RealReports party and just have, like, everything scrolling on, like, projection screens
James: That’s a good idea.
Saad: Mike’s mind always goes to parties.
James: Yeah. I was like, how do I help clients? And Mike’s like, can we have a good time?
Mike: Drum and bass is the only way I can think.
James: Shuts down when I’m on it.
Saad:
Oh, man. So good. Before I know we only got a few minutes left, but definitely again, to James’ point, if you need a if you’re interested in getting a RealReport on a property that you’re interested in, and again, not just in Massachusetts, anywhere around the country. Reach out to Mike and I. We can help you with that. You’re a buyer, seller, or investor. It’s very important to have as much information as possible. Reach out to us. If you’re an agent or a broker and you want it for your team, you know, like, reach out to James.
Saad: James, how does how does how does somebody in that camp reach out to the RealReports team? Obviously, you have your website and what have you, but what’s the best way to reach out?
James: Sure. Yeah. Anybody can go to realreports.ai. That’s the website. Anybody any agent could go sign up and try it out, depending on where you are in the country. There’s decent chance you might have access to it through your MLS. But anybody can always just email me, james@realreports.ai. Happy to get in touch and and chat about it and explain more about the product if anybody’s curious.
Saad: Awesome. Any last thoughts, Mike?
Mike: It’s just very cool how this evolves, but there’s always, a checker of the information. It’s right? Like, don’t follow stuff blindly, but things get more accurate and they get, the more access we have to things, the more we can kinda synthesize that information and be of use to, to clients.
Saad: Absolutely. There’s all types of data that’s available out there. I mean, the crux of this the this whole message and this whole live is, like, make it easy on yourself. Like, all this information is in one place. You can spend hours, days, if not weeks, trying to gather all this information. Now it could be in front of you in seconds. So, no brainer. And and obviously reach out to us if you have more questions or if or if you need a report.
James: So thanks, guys.
Mike: That’s it. Congrats, James. First IG live.
James: Yeah. First one. I haven’t opened Instagram in a while. It’s nice to be back.
Mike: Now yeah. You go clean up those messages and whatnot.
Saad: Yeah. I think I got some people to attempt to.
James: There’s DM’s fun. There a lot of notifications in there. It’s been a while. That’s fun.
Mike: Alright. That’s nice to feel wanted. Thank you, James. Thank you, Saad. Thanks, guys. This is fun. Another Storii Time on the books.
Saad: Alright. Thanks, everybody. Have a good week.
James: See you.
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