Data serves countless purposes, and our team has tackled diverse projects ranging from analyzing the cost drivers of military hardware to uncovering the characteristics that make movies more profitable. One of our most interesting projects, however, was helping an investment firm identify the factors that made residential rental properties more lucrative in their target markets.

The firm’s business model was straightforward: purchase properties—primarily, though not exclusively, single-family homes—and rent them out. Their ideal investments were properties with a high “rent-to-total-expense ratio,” ensuring strong returns relative to the costs of purchasing and maintaining the property.

To assist, we developed a comprehensive hedonic pricing model to quantify the rental market value of various home features. By analyzing data, we determined the economic impact of factors like the number of bedrooms, bathrooms, additional square footage, proximity to amenities, and more. This granular insight into what the market valued allowed the firm to make highly informed decisions about potential acquisitions.

With this model, the client could evaluate each property that entered the market, assessing its potential profitability with precision. By arming them with actionable, data-driven insights, we empowered the firm to strategically expand their portfolio and maximize their returns.