Automated valuation models are literally a weighty issue when it comes to the effect of distressed properties on a market: the impact of properties in foreclosure on surrounding healthy properties can determine whether a mortgage can be refinanced or a property sold at a profit.

“The problem with AVMs is they’re a black box, you don’t know what’s going on inside of them,” says  Ric Miles, CEO of IntelliReal. “If they spit out values that aren’t justifiable, AVMs can do a lot of damage.”

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