Nowadays, no business is complete without taking advantage of artificial intelligence (AI) and machine learning (ML). Many companies have already begun to incorporate AI into their business models, from startups to well-established brands.
AI is shaping the future of home buying through efficient property search, quality lead generation, and assisting transactions or banking. As AI helps owners find the perfect home, real estate investors also gain the momentum to utilize AI to their advantage.
Technology continues to evolve, which creates concerns among real estate managers about implementing technologies successfully. Auxadi, a corporate clients services firm, reported that 39% of real estate managers are already falling behind their competitors and a further 34% said that keeping pace with technology is a challenge.
With this, real estate investors should be aware of artificial intelligence (AI) and how it is changing the way that of real estate business. How is artificial intelligence being used by real estate investors?
Real estate is like any other industry: it evolves with technology to stay on top of the times. Just as we think of business in the 21st century, companies are beginning to implement artificial intelligence and machine learning applications in their workflows.
Auxadi's report, ‘Market Adaptations: Maximising New Growth Opportunities in the Real Estate Sector’, also revealed that real estate managers highlighted the expanded use of technology with 66% of respondents saying that technology will have a transformational effect on investment performance. They believe that the biggest impact on the real estate fund management industry over the next five years will be with the use of Artificial Intelligence (AI). For North American respondents, 77% agreed on the transformational effect, while a staggering 83% said the most benefit will come from AI.
The following are samples of how real estate investors can use artificial intelligence for their benefit based on a study about artificial intelligence in real estate market analysis.
Artificial intelligence has been used as a tool to predict and identify patterns in the economic market. In order to build a successful investment strategy, a trader must be able to recognize market turbulence and rapid changes in volatility early on. Since real estate trades can take longer to close and routine portfolio adjustments may require significant amounts of time, it is crucial to understand the changing market conditions.
Artificial intelligence and machine learning can process and analyze real estate transactions, data, and other information with greater speed and accuracy than many human professionals. With artificial intelligence, machine learning, and other technologies, it is possible to combine analysis of global factors, individual property characteristics, and the customer experience in order to get a better understanding of the market.
According to the Altus Group, many commercial real estate groups spend 15 to 25 percent of their time managing and organizing data, equating to two to three months per year — time that could be spent on more productive tasks.
Due to the heterogeneous nature of real estate markets, it can be important to analyze customer expectations and experiences related to a certain area or even a specific neighborhood in a city.
Rapid changes in business environments may make standard approaches such as surveys inadequate; furthermore, surveys can be time-consuming and costly to develop.
Machine learning and AI can process indirect information such as social network posts, local news feeds, and even anonymous movement statistics, to assess customer experience.
With so many companies already taking advantage of artificial intelligence within their real estate operations and investments, the future is clearly ripe with opportunities for companies that are willing to adapt to this emerging market. With new developments taking place every day, investors should consider staying up-to-date as AI has and will continue to reshape the way of the real estate business.