RESEARCH TRIANGLE PARK – As startup Knock launches in the Triangle, WRAL TechWire talked with co-founder and CEO Sean Black about the firm’s proprietary algorithm works to help buyers and sellers make the best deals.

Knock developed its Knock Deals Forecast to home buyers and sellers understand the relationship between their specific geographic location, the list price of the home, and the expected final sale price for the property.

This graphic shows an analysis of Atlanta’s real estate market:

Copyright Knock

Knocks analysis of Atlanta real estate market

According to its analysis, the Triangle as a whole is more competitive than either Charlotte or Atlanta, with the average predicted savings on homes in the Triangle (sale price vs. list price) at just 2 percent, compared to 3 percent in Charlotte and 5 percent in Atlanta. This data implies that the Triangle market is more competitive than either Charlotte or Atlanta, but it’s only useful if home buyers and sellers can understand more about their specific situation based on home size, list price, and city.

Knock Deals Forecast Data—Triangle—By Price Range

  • Less than $150,000

    • Average predicted savings rate: 3.55%

    • Average predicted savings amount: $3,636.13

  • $150,000–$200,000

    • Average predicted savings rate: 2.21%

    • Average predicted savings amount: $4,021.71

  • $200,000–$250,000

    • Average predicted savings rate: 1.86%

    • Average predicted savings amount: $4,175.07

  • $250,000–$300,000

    • Average predicted savings rate: 1.87%

    • Average predicted savings amount: $5,131.01

  • $300,000–$350,000

    • Average predicted savings rate: 1.95%

    • Average predicted savings amount: $6,186.16

  • $350,000–$400,000

    • Average predicted savings rate: 2.15%

    • Average predicted savings amount: $7.934.73

  • $400,000–$450,000

    • Average predicted savings rate: 2.26%

    • Average predicted savings amount: $9,696.84

  • $450,000–$500,000

    • Average predicted savings rate: 2.39%

    • Average predicted savings amount: $10,854.79

For that reason, Knock Deals Forecast data can also provide home buyers and sellers with insights on where, when and how to look for homes, particularly in a tight housing market like Raleigh or Durham, said Black.

According to the model, homes under $200,000 have the most potential for savings off list price, which means it may be a good time for first-time home buyers to purchase a smaller, starter home, says Black.

The model also predicts that Chapel Hill, Durham or Raleigh may be the best place to make that move, given that there are the best deals on 1 and 2 bedroom homes in those areas.

At the same time, said Black, growing families may want to look in one of the other areas like Cary or Morrisville, where they’ll find more significant savings on larger and more highly priced homes rather than lower priced, smaller homes.

“This data reflects that while yes, home prices are going up, that doesn’t mean that the real value of the home no longer matters,” said Black. “Often times list prices are inflated by misperceptions about the home and the market, and agents who aren’t able to help their client price the home accurately.”

Knock Deals Forecast savings are calculated based on the difference between the list price and predicted sale price, which Knock determines based on extensive historical and current market data, said Black.

Another factor for both sellers and buyers to remember, said Black, is that even in a bidding war, the final sale price does not always end up above the list price.

“Negotiations can occur at a lower price point, or a seller may choose to accept a lower offer with fewer contingencies, such as an all cash offer from Knock, for example,” said Black. “In these cases, we find that our customers often get a 3 to 5 percent discount off list price on average.”

Knock Deals Forecast—Triangle—By City (for homes priced under $500,000)

  • Chapel Hill

    • Average predicted savings rate: 2.83%

    • Average predicted savings amount: $9,165.37

    • Best home size for deals: 1 bedroom (4.32% predicted savings)

  • Durham

    • Average predicted savings rate: 2.30%

    • Average predicted savings amount: $5,471.02

    • Best home size for deals: 2 bedroom (3.05% predicted savings)

  • Raleigh

    • Average predicted savings rate: 1.95%

    • Average predicted savings amount: $5,550.66

    • Best home size for deals: 1 bedroom (3.07% predicted savings)

  • Wake Forest

    • Average predicted savings rate: 1.88%

    • Average predicted savings amount: $6,117.54

    • Best home size for deals: 6 bedroom (3.06% predicted savings)

  • Apex

    • Average predicted savings rate: 1.73%

    • Average predicted savings amount: $5,905.73

    • Best home size for deals: 6 bedroom (2.31% predicted savings),

  • Cary

    • Average predicted savings rate: 1.72%

    • Average predicted savings amount: $5,610.09

    • Best home size for deals: 5 bedroom (2.29% predicted savings)

  • Morrisville

    • Average predicted savings rate: 1.55%

    • Average predicted savings amount: $5,475.65

    • Best home size for deals: 5 bedroom (1.88% predicted savings)