Are Big Data and Predictive Analytics the Future?
by Alec Gress, video/marketing strategist
As 2017 comes to a close, the biggest trends in real estate technology revolve around three big players—Artificial Intelligence, Augmented Reality and Virtual Reality 3D Tours. Let’s take a look at how each is being used in the real estate landscape.
- Artificial Intelligence (AI): Most people think AI is all about sophisticated robotic technology. However, millions of people have already welcomed AI technology into their homes and phones with Amazon’s Alexa and Apple’s Siri. One application where we see AI technology developing is in property management. Technology company Zenplace is using AI technology to streamline processes for tenants and landlords by helping property managers locate new tenants, cost-efficient vendors and proactively create management tasks based on algorithms. Tenants may also report issues via an AI chatbot. AI technology has also provided real estate search engines with a robust consumer search. AI has enabled search functions to get as granular as searching for a specific type of countertop in the kitchens of homes for sale.
- Augmented Reality (AR): Augmented Reality in real estate has been prevalent for the past few years now. With a touch of a button, buyers can envision changes to a home by adjusting the color of a wall or by adding a piece of furniture using a photo and an Augmented Reality app. Companies such as LUX AR provides potential clients the ability to locate properties via GPS. Another AR company, HOMESNAP, allows users to get information on a property by scanning a picture.
- Virtual Reality 3D Tours: In 2017, a prospective homebuyer doesn’t have to wait for an open house to take a peek inside his or her dream home. 3D imaging and virtual walkthroughs are changing the way buyers are buying, and sellers are selling. According to realtor.com, sellers who use virtual reality have less foot traffic in the home, but more serious offers because people can make a decision earlier in the process. Only those ready to purchase will actually visit the home.
Despite the prevalence of this new technology, many real estate professionals remain wary of the true impact moving forward. A recent study conducted by Imprev, a marketing automation company, real estate professionals were asked to predict the future of real estate marketing. Here are some results of the survey:
- Two-out-of-three top real estate executives surveyed say they are more likely to invest in Predictive Analytics (65%), Marketing Automation (65%) and Big Data (64%), while less than half are likely to invest in Augmented Reality and Virtual Reality 3D Tours (46%).
- Only one-third are likely to invest in Artificial Intelligence (30%) by 2022.
- 20% of respondents rate real estate portals, such as Zillow or realtor.com®, as one of their “most important real estate marketing channels and technologies” five years from now.
- Mobile Apps, Social Media and Video will all be more important in 2022 than portals.
- Real estate leaders only wish to invest in technology that will provide a hard ROI.
- System integration, automation and a centralized MLS are all things leaders hope will rise to the forefront of the industry in the next five years.
One surprising finding from the study is the lack of confidence found in AR, VR and AI for the future. Many do not see the ROI to justify the investment. So what do leaders want to invest in? Imprev’s study finds that big data and predictive analysis will be the next wave of tech to hit brokerages by 2022.
Predictive analytics is a way that brokerages can take advantage of complex computer algorithms that mix in historical data and computerized learning methodologies to forecast future buyer and seller trends. Predictive analytics will help to zero in on homeowners who are more likely to sell their home based on the totality of their behaviors. Simply put, these machines can take in thousands of data points such as income, age, number and age of family members, profession, education level and much more to put together a smarter search for a home in a way that simply cannot be matched by human beings. As we move forward into the future of real estate, keep your eyes on big data and automation.