The 36-year-old chess prodigy has built software to quickly buy houses from afar for large investors, beating out regular buyers. Now he is the top broker in Atlanta.

  • Former chess prodigy AJ Steigman is Atlanta’s premier residential real estate agent.
  • He created software that scans large data sets to find undervalued homes.
  • But his clients are not the typical family buyers. They are hedge funds and private equity firms.

AJ Steigman, who lives in Florida and has no full-time employees, sold more homes in Atlanta last year than any other broker.

In 2018, the University of Pennsylvania launched a proprietary software system called “Steignet” and a $20,000 computer that allowed him to sell residential properties thousands of miles away.

The system’s algorithms scan large data sets to identify undervalued single-family homes before humans compete. As the Wall Street Journal first reported, its name comes from the Terminator’s vicious artificial intelligence network “Skynet.”

But I can’t find moms and pop homebuyers on Steigman’s client list. Instead, he works with investors who either overturn houses or rent them out for a profit.

Steigman declined to name its clients, but told Insider they were hedge funds,

net worth

Family Office, a multi-billion dollar private equity firm. institutional investorsThey range from small landlords to major Wall Street businesses. In the fourth quarter of 2021, 18.4% of U.S. homes were bought, an all-time high. red pin announced in February.

“Record high home prices are a problem for individual homebuyers, but it’s one of the reasons why investor demand is stronger than ever,” said Redfin economist Sheharyar Bokhari. said to respond to the increasing trend. “The fact that investors are buying a record share of homes for sale is one of the factors that makes this market difficult for the average homebuyer.”

This is because the average homebuyer relies on mortgages and loans, while large investors can afford to present full cash. When it comes to sellers and listing brokers, cash buyers are much less complex to deal with.

Last year, Steigman sold 300 properties in Atlanta for a total of $86 million, according to the Atlanta Realtors Association. He said this is only “part” of his total settlement (including Florida sales), which he estimates at around $130 million.

The high-tech broker attributes his success in real estate games to his childhood training as an international chess champion. Steigman said national chess master According to Steignet’s website, he won the championship at the age of 13 and has been ranked number one in the US player of his age for eight consecutive years.

“At the time, I was analyzing my games on a computer, and I was always trying to figure out all the different moves and sequences,” Steigman, now 36, told Insider. “So I take a very scientific and quantitative approach to real estate.”

This pattern recognition technology is how Steigman initially predicted residential real estate would be a scalable investment, he told Insider. While other companies focus on their workforce, Steigman says it has doubled its data.

“Just like a chess supercomputer can get rid of 50 grandmasters, if you build a very powerful system, you don’t need a lot of people to do it,” he added.

Homes in Atlanta, Georgia with the Midtown Skyline in the background.

In Atlanta, nearly a third of homes sold in the fourth quarter of 2021 were bought by investors, according to Redfin data.

novikat/Getty Images

Until recently, the biggest player in algorithmic real estate was Zillow’s iBuying division, which closed in November. The company has spent millions of dollars developing advanced algorithms to value homes, buy real estate, and make money quickly.

Zillow CEO Rich Barton said in an earnings call that the iBuying model couldn’t handle the unpredictability of the housing market during the pandemic, leading to overpaying for listings. Zillow, Redfin and Opendoor stocks have all plummeted since last fall due to unsuccessful iBuying efforts.

Comparing the process of designing software to the process of Elon Musk building a rocket, Steigman said there is not a single key characteristic that sets his algorithm apart from the competition.

“Fuel isn’t like a secret sauce,” he told Insider. “It’s every iteration that keeps getting perfect.”

In Atlanta, nearly a third of homes sold in the fourth quarter of 2021 were bought by investors, according to Redfin data. This is the highest rate of any state in the United States. Meanwhile, out-of-town buyers with more budgets than locals are driving up property costs, fueling fears of a housing bubble.

As many Americans become unable to own their own homes, some fear Wall Street’s entry into the residential real estate market will push the average person out of the market. However, although the presence of investor homebuyers has become more prominent in cities like Atlanta and Charlotte, consumers still outnumber investors, as Vox did before. report.

“To be honest, consumers are the largest segment of the market,” Steigman told Insider. “Businesses are strictly limited by the type of real estate they can purchase. “They will trample all the institutions that are incorporated.”

Leave a Comment