No business today is complete without leveraging artificial intelligence (AI) and machine learning (ML). Many companies have already started integrating AI into their business models, from startups to well-established brands.
AI is shaping the future of home buying through effective property research, quality lead generation, and transaction or banking assistance. As AI helps homeowners find the perfect home, real estate investors are also gaining momentum to use AI to their advantage.
Technology continues to evolve, creating concerns among property managers about the successful implementation of technologies. Auxadi, a business services company, reported that 39% of property managers are already behind their competitors and a further 34% said 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 real estate business is done. How is artificial intelligence used by real estate investors?
How real estate investors are using AI
Real estate is like any other industry: it evolves with technology to keep up with the times. Just as we think about business in the 21st century, companies are beginning to implement artificial intelligence and machine learning applications into their workflows.
Auxadi Report, “Market Adaptations: Maximizing New Growth Opportunities in the Real Estate Sector”‘, also revealed that property managers highlighted the increased use of technology, with 66% of respondents saying technology will have a transformational effect on investment performance. They believe the biggest impact on the real estate fund management industry over the next five years will be the use of artificial intelligence (AI). For North American respondents, 77% agreed on the transformational effect, while 83% said the biggest benefit would come from AI.
Here are examples of how real estate investors can use artificial intelligence to their advantage based on a study on artificial intelligence in real estate market analysis.
Artificial intelligence has been used as a tool to predict and identify economic market patterns. In order to construct a successful investment strategy, a trader must be able to recognize market turbulence and rapid changes in volatility early on. Since real estate transactions can take longer to close and routine portfolio adjustments can be time-consuming, understanding changing market conditions is essential.
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. Thanks to artificial intelligence, machine learning and other technologies, it is possible to combine the analysis of the global factors, the characteristics of each property and the customer experience to better understand the market.
According to Altus Group, many commercial real estate groups spend 15-25% of their time managing and organizing data, which equates to two to three months a 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 of a city.
The rapidly changing business environment can make standard approaches such as surveys inadequate; furthermore, surveys can be time consuming and expensive to develop.
Machine learning and AI can process proxy information such as social media posts, local news feeds, and even anonymous movement statistics, to assess customer experience.
With so many companies already leveraging AI in their real estate operations and investments, the future is clearly ripe with opportunities for companies that are ready to adapt to this emerging market. With new developments happening every day, investors should consider staying up to date as AI has and will continue to reshape the way of the real estate industry.