Artificial Intelligence is a complex topic. While some love it and others hate it, there's no denying that it's currently transforming the real estate industry. To that end, here's what investors need to know about Artificial Intelligence in real estate. Read it over to learn how AI is being used in the industry as well as how you can incorporate it into your business.
At its core, the definition of artificial intelligence (AI) refers to a type of technology that can draw logical conclusions on its own. However, though this technology has improved by leaps and bounds over recent years, it's not quite there yet. In reality, today's version of AI technology uses sophisticated algorithms and predictive analytics to make educated guesses about future behavior.
Though it may seem as though AI only burst on the scene a couple of years ago, this technology has actually been around since the 1950s. Alan Turing, a British mathematician and World War II code breaker, is widely credited with its Inception. In fact, the Turing Test is still widely used as a benchmark for a machine's ability to process information independently.
Since then, and especially since the personal computer became a regular household item, we've seen machine learning grow rapidly. Today, the big data industry has an ongoing impact on many aspects of our lives, from social media to real estate.
With that said, it's important to take a look at the ways in which artificial intelligence and machine learning are impacting the real estate industry. In truth, nearly every aspect of the real estate sector has been touched by AI solutions over the past few years. To give you a clear picture of the ways in which AI is impacting your typical real estate transaction, here are a few examples.
Most agents know they're bound to receive plenty of website visitors and potential leads who aren't serious. After all, at this point, it's a common pastime to visit a site like Zillow (NASDAQ: Z) (NASDAQ: ZG) and dream of owning a multimillion-dollar property. However, instead of the agent having to sift through all their leads to identify those with the most potential of becoming a real buyer in the near future, deep learning allows artificial intelligence to be able to qualify leads accordingly.
Other sites use natural language processing (NLP) technology to help specialty agents zero in on their ideal clients. For example, an agent who specializes in the luxury market can use this real estate technology to prequalify their leads so they don't waste time tracking down potential buyers who can't afford their listings.
Ever since listings first became searchable online, technology has played a role in helping buyers streamline their home search. While nearly every home search tool allows real estate agents and prospective buyers to narrow a home search by a list of criteria like the number of bedrooms and bathrooms or location, often, this method still leaves everyone with too many options to choose from.
That's where the AI algorithm comes into play. Many of today's home search tools can use those search criteria to identify the user's preferences and select properties based on those findings. Most algorithms can then offer alternative listings that might be a good match and place the best-fitting listings at the top of the user's search results.
On the back end of the transaction, artificial intelligence can also make it easier for the Realtor to run their real estate business. For instance, many customer relationship management (CRM) systems utilize machine learning for things like auto-fillable data and generating automatic reports.
Not only does this cut down on the amount of time a real estate agent needs to spend in front of the computer doing office tasks, but by taking the human element out of data entry, it helps reduce the number of errors overall.
