THE DANGERS OF AVM’S

Automated Valuation Models
Automated valuation models (AVMs) performed by computers, or non-appraisers, are growing in acceptance. These rely on statistical models such as multiple regression analysis or geographic information systems (GIS). But, while AVMs can be accurate when used in a very homogeneous area, there is also evidence that AVMs are not accurate in many instances (including a large portion of Southern Arizona), especially when they are used in rural areas, or when the subject property does not conform well to the neighborhood. The information used for these reports can often be faulty, as well.