Introduction

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**MovingCastle.in is an automated home valuation modelling software for India** that empowers homeowners and buyers to determine a fair price for their property using a sophisticated AI & mathematical model which incorporates numerous parameters. This advanced model takes into account the "desirability" of the home and its precise geographical location & prices it in for its valuation.

We are challenging traditional valuation methods commonly used in India by considering often overlooked factors that should significantly impact a property's worth, such as local crime rates, pollution exposure, and various other elements & all users have to do to generate a comprehensive valuation report for their home is to enter it's address.

Problem statement

Currently, the process of determining a home valuation in India relies on traditional models that consider several key factors:

  1. The current circle rate [11] of the property's geographic location
  2. Depreciation rate based on the home's age
  3. Reference points such as:
  4. Adjustments for amenities like swimming pools or convention halls

However, this approach raises an important question: Is this methodology sufficient to determine a home's true valuation? Traditional valuation methods, while providing a baseline, may overlook crucial factors that significantly impact a property's real worth.

Scenario: Crime rate

Destruction of homes, Howl’s Moving Castle (2004)

Destruction of homes, Howl’s Moving Castle (2004)

But what if you then learned that the neighborhood where this dream home is located has seen a significant increase in homicide or burglary rates over the past few months? How would this information impact your decision? This scenario raises a critical question: Would your "desirability" for purchasing this home remain unchanged in light of this new information? And it’s impact is not just limited to desirability, home insurance companies are acutely aware of these risks and adjust their premiums accordingly. In areas with higher crime rates, homeowners may face insurance premiums as high as 7.2-12% (for 3-5 years) [10] to protect their homes against burglary and theft, then shouldn't these potentially higher insurance premiums be factored into the price negotiations while buying the home?

Scenario: Industrial pollution exposure

The Irontown, Princess Mononoke (1997)

The Irontown, Princess Mononoke (1997)

Consider another scenario: As a prospective home buyer, you've found a property that seems perfect for your needs and budget. However, you're unaware that the government has allocated land for two large petrochemical factories to be constructed just five kilometers away from your potential new home.

This seemingly unrelated development could have significant long-term implications for your quality of life and it also comes with a potential costs with increase in health insurance premiums, reduction in the property’s value & the home owner’s quality of life, as once these factories become operational, they're likely to increase pollution levels in the surrounding area. Over time, prolonged exposure to these pollutants might lead to respiratory issues and other health problems for residents.

These are crucial factors that need to be considered when determining the true value of a property. Yet, traditional valuation methods often overlook such future developments and their potential impacts.

Scenario: Gentrification