NeighborhoodScout is a website and online database of U.S. neighborhood analytics created in 2002 by geographer and demographics specialist Andrew Schiller, Ph.D. of Location Inc. The site offers neighborhood reports and a search function that allows users to select the location characteristics that are important to them and return a list of their best neighborhood matches. The site is a recognized resource for nationwide crime data, school ratings, home appreciation, demographics and trends for magazines, news channels, website authors and personal finance books, and a listed relocation reference at the U.S. Department of State.
In an interview with Inman News, Schiller discusses that he used to move around often for jobs or for school, and was often in a position to make expensive decisions about the best places in which to buy or rent. “But asking friends or real estate professionals always led to answers that were an inaccurate mix of what my friend or agent thought I wanted, combined with what they themselves want in a neighborhood. As a result, the suggestions were never right.”
Schiller challenged that people should be able to select the attributes that they would like to have in a neighborhood, then let technology find the perfect neighborhood match. He set out to create and then patent the search technology that would allow homebuyers and renters to match or build their ideal neighborhood. He founded Location, Inc. in 2000 and launched Neighborhoodscout.com in 2002.
By 2006, Location, Inc. reported that NeighborhoodScout had nearly 70,000 subscribers and had served over 1 million users since inception. In 2015, NeighborhoodScout reported to serve over 1 million users each month. NeighborhoodScout earns revenue from customer subscriptions and advertising. They also refer homebuyers to real estate agents and collect a referral fee when they transact on a home.
NeighborhoodScout received considerable coverage in real estate and travel-related news after its launch in 2002. In 2003, The Wall Street Journal used NeighborhoodScout in an example of how more homebuyers are turning to the web, rather than their agents, to find real estate data to fuel their decisions. A year later, CBS News featured NeighborhoodScout’s list of top 30 towns in which to buy a vacation home for investment purposes. In 2006, The Wall Street Journal partnered with NeighborhoodScout to release a list of the best 15 towns near metro areas to retire in. In 2008, real estate mogul Barbara Corcoran listed NeighborhoodScout as one of the "best real estate sites." Other NeighborhoodScout lists have been published in Bloomberg Business, Forbes, CNBC, TIME, and CNN Money.
Controversy over Racial and Ethnic Data
In 2011, financial journalist Stacey Bradford of CBS MoneyWatch featured NeighborhoodScout and CEO Schiller in a How-To article about finding the best neighborhood. Bradford counseled readers that sites like NeighborhoodScout are helpful at providing the type of information about areas that real estate agents are prohibited from divulging because of the Fair Housing Act.
In 2014, NeighborhoodScout released a new search feature that allows users to filter their neighborhood search by crime activity, school quality, housing values, and demographic characteristics such as languages, ethnicity, race, and income. The feature soon came under review by the National Fair Housing Alliance who were concerned that showing racial statistics on real estate websites may steer homebuyers to filter their searches based on race.
According to CEO Andrew Schiller, NeighborhoodScout does not violate the Fair Housing Act, and the site could actually help to promote integration. He says the site “is useful for understanding and revealing the truth about locations, helping to break down out-moded stereotypes that could otherwise harm places.” In an interview with Inman News on the topic, Schiller noted that searching for areas based on race and ethnicity is “not necessarily contemptible,” and provided an example of a Korean customer who used NeighborhoodScout to find areas populated by other Koreans.
Schiller compared NeighborhoodScout to a “Consumer Reports for communities” in a New York Times article that followed-up on the subject of providing demographic statistics to homebuyers. He noted that sites with this level of neighborhood detail could protect homebuyers from insistent agents who push them into high-inventory and potentially unattractive markets, despite their wishes. He positions that having demographic data available to the public enables users to find communities that they wouldn’t have otherwise considered because of long-held assumptions or unwarranted perceptions about an area. “Accurate data can help break stereotypes…. It can lift up places, localities that have been bypassed.”
Schiller’s concerns with insistent agents may not be unfounded. In early 2015, Consumer Reports magazine published a list of real estate agents’ “dirty little secrets.” Among them, confessions from agents who steer clients towards higher-commission houses, misrepresentations about the local school quality, and withheld information about problems in the area. The magazine informs readers to get violent and property crime stats from NeighborhoodScout.com.
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