Session 3 is LIVE: Intermediate Mass Appraisal Model Building

(Raising Complexity While Keeping the Rules: Adding VIF, Conditional Variables, and Intra-Town Location)

This session increases complexity in a controlled way: we replace simple correlations with VIF, retain conditional subset variables (including a negative Bedroom coefficient), and use ZIP codes to capture economic diversity within a single resort town. The post-outlier model reaches practical BLUE status.

What We Cover in Session 3:

1.   Beyond Pairwise Pearson (r): Why two-variable correlation matrices fail to catch joint multicollinearity—and how to implement Variance Inflation Factor (VIF) auxiliary regressions to certify feature schema stability (< 5.0 threshold).

2.   Hierarchical Variable Architecture: How to model conditional subset variables (Bedrooms, Bathrooms, and Pool) against foundational spatial/physical anchors, including economic rationale for negative bedroom coefficients in open-layout resort markets.

3.   Micro-Spatial Vectoring: Simulating intra-town economic diversity using k-1 ZIP code dummy structures.

4.   The Power of Two-Pass Z-Score Purging: How trimming just 5.12% of extreme residual noise (|Z|> 2.0) transforms model efficiency and elevates the specification to certified BLUE status.

The Executive Summary is free for everyone. Paid subscribers can access the full session.

Read Session 3 on Substack:

https://sidsom.substack.com/p/session-3-model-building-at-the-intermediate

#MassAppraisal #PropertyValuation #RealEstateAnalytics #Econometrics #AVM #CAMA #DataScience #DataAnalytics #Substack