Buying or selling a dwelling is a major financial and emotional undertaking. In our digital era, these processes can be addressed differently than before – with more consideration, accuracy, and automation into them.
Though real estate has traditionally been slow to embrace the recently emerged tech trends, it’s high time to start. Such technologies as Artificial Intelligence & Machine Learning can bring tangible benefits to all parties involved – sellers and renters, buyers and tenants, as well as to real estate brokers, agents, and other professionals.
How can artificial intelligence be leveraged for the real estate market?
Artificial Intelligence (AI) is such a broad concept and is so much talked about that it may cause misunderstandings about what it exactly means. So before we start revealing the great potential AI has in real estate, it’s worth recalling what the technology is about.
Artificial Intelligence is a set of technologies that aim at enabling machines to perform sophisticated tasks that are inherent only to humans, such as judgment and evaluation, problem-solving and decision making, pattern recognition, comprehension and production of language. One of the most widespread approach to achieve artificial intelligence is through Machine Learning (ML). ML is the field of computer science, which is aimed to make computers learn from the data they are exposed to by themselves, without being explicitly programmed.
The machine learning-enhanced software has recently made much splash, for its ability to сompletely automate time-consuming repetitive tasks, make intelligent recommendations to human professionals, automatically detect suspicious behavior and many more.
Artificial intelligence has been used to advance many industries, including finance, insurance, retail, healthcare, and more; and real estate is yet another industry able to embrace the full power of the disruptive technology.
Imagine having data-based answers to the questions like “Who of the current prospects is most likely to buy the house A? What is the probability of that?” in a matter of seconds… Obtaining the relevant insights, such as fact-based predictions, buying patterns, crucial conditions for successful deals and the factors that result in no deals at all – these are just a few opportunities that the technology can offer.
Enhanced Data Management for the Real Estate
Brokers deal with massive datasets of legal papers, property appraisal reports, sales details, ownership history, zoning regulations and so on. The amount of data grows as a broker reaches the stage of finalizing the contract, and includes leases, non-disclosure agreements, partnership agreements, supplemental financial documents and other documents.
Surely, the spread of computers alleviated much paperwork, but this hasn’t made real estate a less documentation-intensive field. The documents have become digital, but still, a human professional is needed to deal with all the data. Some companies use systems such as ECM, ERP, BPM to alleviate their data issues. This empowers them to work quicker and more effectively, but only to a certain limited degree.
But what if we tell you that companies can bring their data management to another, greater level?
Artificial Intelligence introduces one of the newest and most innovative ways the data can be managed: faster, more comprehensively, requiring less (or no) human attention.
AI can outperform a real estate professional in performing their major responsibilities such as conducting market demographic studies, environmental research, and financial analysis. The technology can be leveraged to ensure that everything is in order with documentation by constantly analyzing it; and in case of any inconsistency, such as missing signatures, invalid characters, empty fields, unintended legal missteps etc send notifications. Such effective data management service allows having data logically structured, securely stored, easy to retrieve and analyze, cleaned and without duplications.
So yeah, we can say that artificial intelligence can be used in the real estate to enhance Data Management.
Gaining Data-Driven Actionable Insights with Artificial Intelligence
What’s more, ML-driven software is able to pick up on patterns in the data (which are often imperceptible to the human eye) and turn reams of data into actionable insights. For instance, if fed with the corresponding data, it can indicate when a specific neighborhood is likely to explode in popularity.
Effective Lead Management
Lead management is the central activity across all industries, and real estate is not an exception.
A powerful AI system can scan an awful lot of data points drawn from historical sales records to identify the properties most likely to sell. This information can be of help to marketers, salespeople and brokers in their advertising activities.
AI doesn’t eliminate the need to make calls to potential clients, but it can ensure that every person a broker addresses has the potential for success. Therefore, integrating AI to the real estate doesn’t diminish the role of human interaction, but makes it more efficient.
From manual property appraisal to automated valuation
Determining the value of property in real estate always presents a challenge. And the most plausible price stems from evaluating as much information as possible.
Current appraisal techniques are often based on a previous sale price, failing to take into account factors like transportation and infrastructure improvements, changes in the environment, local neighborhood, and other amenities (like schools, stores and access to public transportation) that have an impact on a property value. Due to pattern recognition abilities, the ML-based software can be of great help in resolving this significant issue by revealing the whole bunch of price-affecting factors.
But, even more importantly, such software can streamline the negotiation process by predicting where a price compromise is likely to occur. This provides brokers with precious information, meanwhile preventing from lost opportunities and fails of telling them too high or too low price of the property. Knowing that an initial offer is well within market standards — and having data to back it uplifts a heavy burden of a broker’s shoulders.
Intelligent Chatbot assistants in Real Estate
The world is experiencing the return of chatbots – but for this time, they are likely to stay for long. The emergence of ML paved the way for sufficient advancements concerning the technology, as the chatbots become able to “learn”, and therefore, answer more specific and complex queries. And most importantly, now people find them really appealing – according to the statistics from a Business Insider report, “approximately 45% of end users prefer chatbots as the primary mode of communication for customer service inquiries”.
The key advantage of chatbots is that they are on alert 24/7, ready to interact with potential prospects. Featured on a website or application, they can answer any question in a jiffy, be its square footage, leasing terms, or other topics of interest. Moreover, based on user preferences, a chatbot would make personalized offerings. All in all, chatbots in the real estate can be very effective in engaging visitors, resulting in higher lead conversions.
Leveraging artificial intelligence in applications in favor of Real Estate
Finding a suitable home and making clients fall in love with that home is generally the hardest part of a residential real estate broker. And even there AI has something to offer – solutions that increase customer satisfaction when evaluating a potential home.
Powerful visualization software based on ML, neural networks, and augmented reality can be designed to cater to consumers’ desire to get to know whether a particular place could turn into their “dream home”.
One of the most notable examples is the “Ikea place” application, introduced by IKEA. The app uses augmented reality to allow users to see how chosen furniture would look in their homes. According to Business Insider, the segment is rapidly gaining popularity.
Another example of improving customer satisfaction through an AI-driven app is Azati’s Image Modeling Application. The mobile application enables users to replace the existing wallcovering with a new choice, and instantly builds a realistic model of a new room.
Will artificial intelligence substitute professionals in real estate?
Every other discussion about AI is followed by the concerns of whether or not the technology would substitute humans. Though some people fear it would happen, the mentioned technologies won’t be stealing jobs from the brokers, nor would they challenge the necessity of humans in the industry.
The implementation of AI would take over the repetitive activities and some of those requiring human intelligence, but at the same time, it would let professionals concentrate only on the most complicated and creative work, and may even give rise to new professions at the interface between the jurisprudence, real estate laws and computer science.
Real estate is headed for a digitized and automated future. As Artificial Intelligence for the real estate becomes cheaper to utilize, it is becoming more and more prevalent in our daily lives. As soon as real estate brokers learn how to use the tremendous power of technology instead of rejecting it, they would have nothing to fear and everything to gain.
Are you thinking about the ways you could improve your Real Estate business with a robust AI-solution? Call us at +1 (973) 597-1000 or fill out the form below for a free consultation.