A new product plans on hitting the market this year and looks to take a swing at Zillow’s market share. Revestor, brought to you by Bill Lyons promises to bring a new tool to investors that will open the door to quick market valuations and investment opportunities. Recently, I had the opportunity to be a beta user for a new real estate software start-up. I’ve also been asked to give my honest feedback and a review.
I got a chance to interview Revestor’s Founder and CEO, Bill Lyons, to ask him some tough questions:
LC: How did you come up with the idea for Revestor?
BL: “Well, as we all know the housing market is in desperate need of a product that can help restore confidence. People are no longer interested in buying based on salesmanship or hyperbole. Consumers have been beat up enough, they’re very apprehensive and they lack trust so they’re demanding transparent information and quantifiable data – they just don’t know where to turn. It was time for technology to bring something better, something simple and something powerful – And that is how Revestor was born. I invented an algorithm to generate and search key investment indicators.”
Revestor filed a patent titled “Real Estate Investment System and Method of Controlling a Commercial System by Generating Key Investment Indicators”
LC: What problem does Revestor solve? What’s so special about Revestor?
BL: One, Revestor instantly finds homes by the highest returns in a given area. This alone eliminates hours of research and number crunching. Two, as I mentioned earlier, Revestor empowers users with the information they need in order to make smart decisions.
LC: Earlier you mentioned, “Key investment indicators” what are they?
BL: “There are many key investment indicators for real estate. Advanced users tend to use them all, we provide them (all), but the most popular are cash flow and cap rate. If real estate investors use cash flow and cap rate, why wouldn’t you? After all, buying a home to live in is also an investment.”
LC: I find it hard to believe that a first-time homebuyer or the average consumer is going to understand cash flow and cap rate…
BL: “They better! The days of “my bank didn’t tell me what I was signing and I didn’t understand it” or “my real estate agent talked me into the deal to get their commission” are over. You are signing federal documents and disclosures in front of a notary public, people. America is the land of opportunity not the land of blame and bailouts. If you are buying a house you better understand what you are doing and you better take responsibility. It is the biggest investment of your life. If not educate yourself. Revestor is a tool to help you do so.”
LC: Ok, Ok lets not get political here, ha. So what is so important about cash flow and cap rate?
BL: “Cash flow and cap rate are most often used in real estate investing to help determine value. Real Value. Whether you are a homebuyer or a real estate investor, knowing if you can rent a home for your payments is important and can help bring a piece-of-mind. What if you were to lose your job or be transferred? Buying a house that you can rent for your payments greatly reduces your risk. Revestor makes cash flow and cap rate simple. Cash flow is defined as the amount of money left over each month after all expenses and mortgage payments.
Gross Rental Income: $2,000/mo
- Expenses: $ 800/mo
- Mortgage: $1,000/mo
= Cash flow: $ 200/mo
Capitalization rate or Cap rate, is determined by dividing the annual net operating income, or NOI a property generates by the price that you are able to purchase the property for.
Annual Net Operating Income (NOI)
Cap Rate = —————————————-
6% Cap Rate = —————————————-
$200,000 Purchase Price
LC: Can you walk us through some screenshots of the beta site?
BL: “Sure, here is the homepage. This is how it works: Simply enter in the location, select the price range, and select what you want to search by; cap rate or cash flow.
When you hit search, Revestor’s patent–pending algorithm uses key real estate indicators and data to quickly find the homes with the highest potential returns in the area you selected – and organizes them for you in a map and list view.
That’s it! No more wasting time, no more wild goose chases, no more guesswork! Revestor, empowers you with the information you need to make superior decisions. Revestor, shows you the best homes in your price range and area – and paints a picture of your local real estate market that you’d never seen before.
Each home can be expanded into a mini-detail summarizing all the key indicators associated with each property. If you find yourself intrigued simply click “Full Property Details”.
Here, you can view pictures…a summary…and a description of the property. Everything you need to know is right here. With just a few clicks you can make adjustments and decide if you want to purchase the property. Think you can get the property for less? Slide your offer down and see what happens. Think you can get more rent? Slide the rent up and see what happens. Want to buy the property only if the rent will cover the payments? Slide the cash flow to break-even and see what you need to buy it for. Whether you are a first-time buyer or a real estate guru there are all kinds of cool things you can do with Revestor to plan your future.”
LC: Very cool. I like the layout and the design very user friendly. Almost like a Zillow meets E*Trade?
BL: “I really don’t see us as a competitor to Zillow but more of a strategic partner. Zillow does what Zillow does best and we do what we do best. Who knows maybe we will be a buyout target for Zillow or E*Trade. Trulia is rumored to be one of the most popular private stocks right now…so we will see”
LC: Speaking of E*Trade do you think they would be interested in licensing or purchasing Revestor’s patent?
BL: “E*Trade forever changed investing in stocks by providing the same tools and information as stock brokers had to the general public. As a result less and less stocks are purchased today based on a broker’s salesmanship or hyperbole. E*Trade empowers users to make their own decisions based on quantifiable key economic indicators. They forever changed the industry from old broken ways to today’s technology. Revestor will do the same to the real estate market as E*Trade did to the stock market. Revestor provides transparency instead of decisions based on hyperbole and an agent’s salesmanship. Homebuyers and real estate investors can confidently make their own decisions based on quantifiable key investment indicators. Never before has there been an opportunity to do so. It is time for Revestor to restore the market and forever change the way in which people purchase real estate. The information and transparency does not eliminate the real estate agent, it just allows them to better focus in on ones best interests. Why wouldn’t E*Trade want to provide key investment indictors for other asset classes such as real estate?”
LC: Pretty bold statements. How do you plan on helping real estate professionals like real estate agents and loan officers?
BL: “No doubt that both are key in supporting a buyer in a successful transaction but there are also many others involved. Just as our competitors do we will sell zip codes to real estate professionals but our “integrated services program” is a lot more involved. It is more of a step-by-step buying process then your typical real estate ad. Real Estate professionals are not limited to loan officers and real estate agents. Our integrated service program includes property managers, insurance agencies and agents, title companies and reps, escrow companies and officers, home warranty companies, property inspectors, credit repair companies, brokerage houses, financial planners, wealth managers, life insurance agencies and agents, banks and credit unions, building contractors, law firms and attorneys, interior designers, tax professionals and CPAs, Pest/Termite companies, cleaning service, you name it. Historically, buyers have not been able to choose all of their service providers. Instead agents and lenders choose for them.
The integrated services program puts the control back in the hands of the consumer to choose based on reputation and price.”
LC: So how is Revestor going to make money?
BL: “Well I think that LinkedIn’s stock is so successful because they have two pillars in their Parthenon: Subscription and Advertising. We also plan on doing both we will sell zip codes to real estate professionals (Yes, a little plug you can reserve your zip code now) and we will offer advanced users the ability to upgrade their account to a premium subscription”
LC: Why would someone upgrade? What do they get?
BL: “Well the site is free to use, anyone can setup an account and search the site. However advanced users can upgrade for a $49/mo fee. Premium users get access to more properties, get advanced alerts of properties in their search criteria, get to enter custom settings into the algorithm and a dashboard to track their portfolio of properties and their overall cash flow.”