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Slide 1 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic
Slide 2 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small
Slide 3 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth
Slide 4 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem
Slide 5 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow
Slide 6 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result
Slide 7 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time
Slide 8 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank
Slide 9 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application
Slide 10 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting
Slide 11 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts
Slide 12 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3
Slide 13 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … …
Slide 14 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future
Slide 15 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future
Slide 16 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price
Slide 17 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview
Slide 18 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue
Slide 19 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association
Slide 20 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs
Slide 21 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue
Slide 22 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results
Slide 23 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results
Slide 24 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results Guides buyer through the process of finding the “right” house –realistically and financially, in a way that is logical, but natural Considers buyer’s present situation and future plans Helps buyer compare houses that may be very different – in features and price Allows buyer to accurately evaluate trade-offs between what he wants and how much he’s willing to pay Makes sure buyer doesn’t spend more than he can afford Recap: What’s New
Slide 25 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results Guides buyer through the process of finding the “right” house –realistically and financially, in a way that is logical, but natural Considers buyer’s present situation and future plans Helps buyer compare houses that may be very different – in features and price Allows buyer to accurately evaluate trade-offs between what he wants and how much he’s willing to pay Makes sure buyer doesn’t spend more than he can afford Recap: What’s New Hoped for Results More happy and financially stable buyers Decreased risk for mortgage provider Overall healthier real estate and mortgage system
Slide 26 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results Guides buyer through the process of finding the “right” house –realistically and financially, in a way that is logical, but natural Considers buyer’s present situation and future plans Helps buyer compare houses that may be very different – in features and price Allows buyer to accurately evaluate trade-offs between what he wants and how much he’s willing to pay Makes sure buyer doesn’t spend more than he can afford Recap: What’s New Hoped for Results More happy and financially stable buyers Decreased risk for mortgage provider Overall healthier real estate and mortgage system Completed Work Running Interview user interface Suggested attributes for various lifestyles Design of rest of application
Slide 27 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results Guides buyer through the process of finding the “right” house –realistically and financially, in a way that is logical, but natural Considers buyer’s present situation and future plans Helps buyer compare houses that may be very different – in features and price Allows buyer to accurately evaluate trade-offs between what he wants and how much he’s willing to pay Makes sure buyer doesn’t spend more than he can afford Recap: What’s New Hoped for Results More happy and financially stable buyers Decreased risk for mortgage provider Overall healthier real estate and mortgage system Completed Work Running Interview user interface Suggested attributes for various lifestyles Design of rest of application Future Challenges Statistical analysis to build realistic hedonic model of projected prices Working prototype for Boston area listings => eventually expand to entire US Cognitive system that “learns” from user responses to give improved attribute suggestions Redesign questions and relevant attributes based on user feedback
Slide 28 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results Guides buyer through the process of finding the “right” house –realistically and financially, in a way that is logical, but natural Considers buyer’s present situation and future plans Helps buyer compare houses that may be very different – in features and price Allows buyer to accurately evaluate trade-offs between what he wants and how much he’s willing to pay Makes sure buyer doesn’t spend more than he can afford Recap: What’s New Hoped for Results More happy and financially stable buyers Decreased risk for mortgage provider Overall healthier real estate and mortgage system Completed Work Running Interview user interface Suggested attributes for various lifestyles Design of rest of application Future Challenges Statistical analysis to build realistic hedonic model of projected prices Working prototype for Boston area listings => eventually expand to entire US Cognitive system that “learns” from user responses to give improved attribute suggestions Redesign questions and relevant attributes based on user feedback For Bank of America Differentiate from other mortgage businesses Not just a customer-conscious financial product, but comprehensive and useful tool Perfect part of the suite of other financial and life planning tools in development at BoA, CFB Reinforce message as a bank that helps plan your life and your future -- worthy of lifetime of trust
Slide 29 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results Guides buyer through the process of finding the “right” house –realistically and financially, in a way that is logical, but natural Considers buyer’s present situation and future plans Helps buyer compare houses that may be very different – in features and price Allows buyer to accurately evaluate trade-offs between what he wants and how much he’s willing to pay Makes sure buyer doesn’t spend more than he can afford Recap: What’s New Hoped for Results More happy and financially stable buyers Decreased risk for mortgage provider Overall healthier real estate and mortgage system Completed Work Running Interview user interface Suggested attributes for various lifestyles Design of rest of application Future Challenges Statistical analysis to build realistic hedonic model of projected prices Working prototype for Boston area listings => eventually expand to entire US Cognitive system that “learns” from user responses to give improved attribute suggestions Redesign questions and relevant attributes based on user feedback For Bank of America Differentiate from other mortgage businesses Not just a customer-conscious financial product, but comprehensive and useful tool Perfect part of the suite of other financial and life planning tools in development at BoA, CFB Reinforce message as a bank that helps plan your life and your future -- worthy of lifetime of trust Thank yous Dan Ariely Marko Popovic Kwan-Hong Lee Dawei Shen Shrini Deb Roy Aithne Fellow UROPs: Ryan Stephen, Oscar, Leslie (“UROP”) Irum, Andrew
Slide 30 - Dream House Calculator Helping people find the house they need, love and can afford MIT Media Lab Center for Future Banking UROPs: Ana Chen, Mary Hong Advisors: Dan Ariely, Marko Popovic Have you ever… Thought you “needed” a house with 6 bedrooms, 3 guest rooms and a huge living room …then discovered you really didn’t? Bought a cozy cottage that seemed perfect at the time …only to get married a few years later. With elderly in-laws moving in and children on the way, suddenly the “perfect” home seemed way too small At Thanksgiving dinner, your obnoxious cousin constantly brags about his new 3-story colonial in the suburbs with French doors and that amazing spiral staircase Next time, you find yourself sinking money into a house even bigger and fancier than his, but completely unaffordable …before you know it, you are mortgaged for all your worth Defining the Problem Current Resources (1) Real Estate Search Tools: “Checklist questionnaire” - criteria by physical attributes “Filter” approach Examples: Coldwell Banker, Prudential, Zillow (2) Mortgage Calculators: Calculate maximum mortgage buyer can pay Problem: Doesn’t help user decide what is necessary – or not “Filter” too general or too absolute Problem: Doesn’t calculate what buyers should borrow Many people don’t: Plan adequately for the future Make a distinction between what they need and what they want Consider how circumstances change over the time span that they plan to live in the house Result Mortgage Crisis In 2007, delinquency and foreclosure rate for all mortgages was 7.3% 5.7% of home equity lines of credit were delinquent or in default at the same time Take-away Buying a house is one of the biggest financial decisions in a person’s life It is a complex, highly personalized process, in which it is easy to make mistakes When people make the wrong choices, it causes problems for them and the bank Solution: a new kind of Real Estate and Mortgage Application Strategy Guide -lifestyle -wants/needs -dreams -future -priorities Quantitative -statistics -algorithms -hedonic pricing model (economics) -searching & sorting Concept: process in 8 parts Hopes, dreams and the future 3 kids Modern Garden Eat out Dog Entertain guests Golf Hiking Husband Work (artisan) Comfort Lots of light 1 2 Priorities Backyard Study Good school district No lead paint Dining room Bar Patio Studio Tool shed Garage Foyer 3 4 Financial Boundaries Hopes, dreams and the future 2 car garage 2 car garage Pool Many windows Good school district Finished basement Shed Eat-in kitchen Single level … … … … Round peg, square hole problem… Financial constraints Hopes, dreams, future Trade-offs: - Deform circle Cut the circle Solutions * Greater financial risk Change size of square* Financial constraints Hopes, dreams, future Financial constraints Financial constraints Financial constraints Hopes, dreams, future Hopes, dreams, future Hopes, dreams, future Comparison New metrics for comparing houses A B C Financial constraints Hopes, dreams, future Financial constraints Hopes, dreams, future Hopes, dreams, future Financial constraints House X is 80% like A at 110% of projected price House Y is 60% like A at 80% of projected price Demo Design Screen Shots Prioritization Financial interview Attributes Association Trade-offs Library / “Basket” Search Results Interview Prioritization Continue Association Trade-offs Basket Urban Cape My House Kelly’s House Small yard house House 2 Library House 1 June_30_08 Urban Cape Dream home 1 My House Kelly’s House Small yard house House 2 Fill Your Basket Continue Search Results Recap: Information Flow Interview I (Lifestyle) Prioritization Interview II (Finances) Associations Trade-offs Statistics, Hedonic pricing model Basket (metric) Sorted Results Guides buyer through the process of finding the “right” house –realistically and financially, in a way that is logical, but natural Considers buyer’s present situation and future plans Helps buyer compare houses that may be very different – in features and price Allows buyer to accurately evaluate trade-offs between what he wants and how much he’s willing to pay Makes sure buyer doesn’t spend more than he can afford Recap: What’s New Hoped for Results More happy and financially stable buyers Decreased risk for mortgage provider Overall healthier real estate and mortgage system Completed Work Running Interview user interface Suggested attributes for various lifestyles Design of rest of application Future Challenges Statistical analysis to build realistic hedonic model of projected prices Working prototype for Boston area listings => eventually expand to entire US Cognitive system that “learns” from user responses to give improved attribute suggestions Redesign questions and relevant attributes based on user feedback For Bank of America Differentiate from other mortgage businesses Not just a customer-conscious financial product, but comprehensive and useful tool Perfect part of the suite of other financial and life planning tools in development at BoA, CFB Reinforce message as a bank that helps plan your life and your future -- worthy of lifetime of trust Thank yous Dan Ariely Marko Popovic Kwan-Hong Lee Dawei Shen Shrini Deb Roy Aithne Fellow UROPs: Ryan Stephen, Oscar, Leslie (“UROP”) Irum, Andrew Questions?