Embrace the technology to beat competitors.
A typical National Association of Realtors presentation is full of insanely dense information. There is lots of debt, and too many options to pick from, and so on. There is nothing that’s specific to the real estate industry, but there is so much data that I’m sure even the most intelligent people would lose interest in it if presented in a way that didn’t also throw some light on their lives.
So how to use AI to your benefit?
If you’re a real estate agent, chances are you have a lot of information on your current deals. You’ve gathered a ton of leads and where they came from and you’ve got a long list of questions about the property. You watch social media channels, you read articles and books and you learn constantly about the topic. In some cases, you even go into meetings where you introduce yourself as a real estate agent. If you’re like me, you start to create spreadsheets full of info, parsing data sources and creating reports with insightful metrics about your latest deals.
This isn’t a bad thing, and in fact, it’s fantastic to have data to build out detailed, actionable reports. But not every agent can afford a dedicated system that can parse and deal with data as fast as you can. And to make it even worse, the number of opportunities for use of artificial intelligence are limited only by the time and brainpower you have to spend crunching numbers. When the natural intelligence capabilities of a machine are beyond what you can compile in an afternoon, you’re out of luck. You can install a package that will collect this data from the agent on the go, and you can do more research on it, but it’s still slow. There’s nothing keeping you from analyzing in real time what a particular real estate agent is saying.
I’ve been listening to a ton of music and movies over the past few years. I’ve had music subscription services for years, but now I have an entire Spotify section in my computer with playlists of indie / alternative / indie jazz music. Guess what? I listen to it on my phone, while I’m driving, and I can create a playlist on my iPad that will turn on when I pull into my driveway, and more. To me, that’s a “real time analytics” scenario. Here are a few examples, but the same thing could be done with many other sources of information from forums, zillions of blog posts and of course, twitter.
In the next decade or so, AI software will become more prevalent than ever before. Some places will serve just-in-time delivery services to those who order ahead of time, others will provide on-demand roadside assistance. Others will even be able to help in operations — such as finding you parking when you’re in a hurry.
Ultimately, no one will deny that these new AI software tools will have tremendous impact on the real estate industry, which includes everything from tenant accounting to commercial real estate loan origination.
As a small developer, you’ll start out by implementing better database and internet technology to allow your website to work flawlessly. Then you’ll realize that an automated digital dashboard that stores every piece of information related to your real estate portfolio is not only more convenient, but it’s also potentially more accurate.
Within a couple of years, automation and AI will become an important asset to a developer like yourself — allowing you to manage properties in the same way you do today, but it will deliver information and insights that can only be accessed via an artificial intelligence computer.
So when in your team discussions do you mention the possibility of a machine learning or AI-powered machine that provides a wealth of strategic insights? At the simplest, the more information it can access — the more useful your AI software can be to your team in its current state. In reality, your intelligent AI software will be revolutionizing your enterprise and will ultimately increase the value of your real estate property portfolio by leaps and bounds.
If you do discuss the massive growth that’s coming your way as a software developer, you’ll see that many of your friends are also developing some of the same AI software. You’ll recognize that if you can’t bring these advanced tools to the table (or if you haven’t been able to) then you’ll need to start taking more real estate market intelligence into consideration and incorporate AI technology into your business plan from day one.
This is the reason I’m a fan of planning AI Strategy. I’m preparing an in-depth approach to developing AI software to provide real-world examples, insight into current research issues and some very cool projects that will make your office floor look more efficient and leave your fellow developers a bit confused (or speechless). If you’re the kind of developer who prefers insights over pure numbers — this report will be of great interest to you.
In the real estate industry, ultimately technology is king. If your team can unlock the potential and convenience of AI software, no one will be able to tell you otherwise. Let’s start thinking about the all-encompassing possibilities surrounding Artificial Intelligence technology in the real estate industry — and where the industry will see ROI as a result.
As you can see in the data, there is potential to create several unique products that would be of enormous use to your clients, and also very helpful to other agents in their own real estate world.
Let’s be practical now and list what you can really do with AI in Real Estate.
In general you can:
- Determine what might be sold in your house by looking at the mortgage, home values and other similar data
- Create lists of where to find homes with a specific kind of buyer (one based on geographic location), and identify sources of vacancies
- Create a guide of which properties are worth selling off for the best value
- Create an inventory of your clients’ homes by what they mentioned in past statements
From a geographical standpoint you can:
- Create a listing of properties with problems (exceptions, HOA conflicts, etc) that you should be aware of.
- Create a list of properties in a certain kind of zoning that are either super high or super low incomes.
- Create a list of properties with kids that either don’t have nannies or charge a lot for the visits.
- Create a list of sales agents that you should try to hire, based on your previous sales data
Education-wise you can:
- Create a “How to Shop” list of places with experienced professionals, based on your previous experiences or searching records with different categories.
- Create a “How to Buy” list of places where you can find the best prices, based on the type of deal you want to make.
Artificial Intelligence is the technology that allows computers to read large amounts of data using algorithms. Most of the businesses and non-profits or public agencies’ algorithms are created in parallel to solve a specific problem, so that the solution can be simplified and implemented. For the purpose of renting rental properties an AI system allows you to search for the desired housing on the platform of the agent you selected. The AI system will look through the house listings that it has in the database and create a predictive profile and assist you to obtain a good apartment with suitable price.
The intelligent assistant will read all the available data that match with your profile and will show you the ideal property and the vacancy rate with different options to choose. This data are like predictive models for a financial investment and is based on the complex factors for adjusting the rental value and finding the perfect location. Besides, the AI system not only performs that complex task but also maps the parking opportunities, all the furniture the owner has stored that you can rent. It will organize all the monthly expenses and monthly movements and calculate the rent, if it changes. Of course, the efficient AI system knows everything that can be useful for the rental, making it more convenient.
For example, almost ten years ago, in 2005 to 2006, real estate companies’ slogan used to be “Get the right house for the right price”. At that time more than 80% of the homes in the US were rented according to the home value. After 2008, the US real estate market slipped, most of the people stopped their home buying spree and switched to renting to their families because of mortgage crisis. However, according to the Reserve Bank of Australia in late 2014, the share of homeownerships at 75% and the corresponding share of rentals at 30%. Just take a look at these numbers and you will realize how the rental market grew up during those ten years, and now with the rise of the online property market.
Thanks to the intelligent agent, we now have a totally new paradigm for the rental market, where there is no longer the need to collect such data from houses owner, mostly the owner does not know what is written on the invoice or what is written on the lease agreement. But now the data about the availability of the house are captured in a third party’s database, that allows rent monitoring and the reporting. So in a perfect picture, the entire apartment rental experience is very simple and efficient.
Real estate AI will cut out repetitive tasks and create faster and more effective use cases. It can help you to proactively manage your inventory without losing track of inventory. It can also provide real estate market info and independent assessments to help with negotiation and transactions. It can also help you to target high-value homes to agents and buyers to increase relationships and cut out unnecessary administration costs.
Whether you’re marketing a new property through listing or home search apps, or running a market research to improve your metrics, AI can eliminate manual actions to help you solve your problem faster, right from your app or website. AI can also help out in commercial real estate where data is a limited commodity.
It’s time to embrace Artificial Intelligence now.