One of the largest technological developments is that of artificial intelligence (AI). Luke Liplijn, founder of Matrixian Group, talks about the important role AI will play in real estate in VJ.
Every day, successful new initiatives arise in the real estate sector, and some even have a disruptive effect on the established order. What all of these innovations have in common is that they are technology driven and that they try to utilise this technology in the most human way possible.
One of these technological developments is that of artificial intelligence (AI). Some even say a new era is coming. But how do you use this for a sustainable growth of your business? The applications of AI seem endless, and in this column, I discuss six developments in which artificial intelligence will play an important role.
1) Predicting the dream home based on big data
Building a dream home based on data, this was the challenge we were happy to tackle for the OSRE WoningDossier, so that developers can build with a greater focus on the demand. With the data of Matrixian Group, the historical search profiles of the OSRE WoningDossier and the use of Artificial intelligence, we have tried to predict how someone’s dream home should look. We have tried to answer questions like ‘How does someone truly want to live? What phase of their living career are they in? And how do we translate that into a dream home?’.
The enormous amounts of data generated by Matrixian Group, the WoningDossier, open data from the government and social media make it possible to suggest the dream home of every home seeker in a targeted way out of homes that are for sale. This not only involves the architectural aspects and location data, but also the emotional element that comes with finding a new home.
2) Automated appraisals with home value models – Friend or foe?
A model-based home valuation is an appraisal based on home data without the need to view the home. Based on this home data and analyses, an accurate valuation can be provided. Which is nothing new in itself. It has existed in the Anglo-Saxon countries since the nineties and blew over to the Netherlands a number of years ago.
But what is new is that due to an increasing growth in real estate data and an exponential growth of computing power, home valuation models are becoming so accurate that they can replace the current appraisal reports. I recently saw an example of an automated home value calculation based on location data and automated image recognition based on the photos from the property advertisement. The home valuation models are becoming increasingly accurate.
I predict that, depending on laws and regulations, within 10 years from now, 90% of homes will no longer be valuated through physically visiting the home. The appraiser that we know today will cease to exist.
3) Leads for brokers and opportunities for home seekers
The next step in the market of real estate brokerage market is mediating living space in homes that are (just) not yet for sale by predicting what homes will come up for sale very soon. In parts of the US where the housing market is heated, this is already happening.
How does it work? Approximately 250 data points are known per building owner, including data about the location, the homes and registrations of activities at the address. Based on this data, the likelihood of a home coming up for sale in the short term can be predicted. Even before the home comes onto the market, the owners are approached by one broker who tries to take on the mediation.
Especially in markets where the supply is limited and the demand is great, this provides a boost to real estate agencies and improves the flow in the housing market.
4) Chatbots for customer contact
An interesting development within the world of customer contact, namely the rise of chatbots. This has pros and cons: on the one hand, we feel that contact with organisations should be personal, but on the other hand, it needs to be very efficient. We want to be helped quickly and properly. More and more companies use proactive live chats from their websites, with a pop-up in which they offer to help you with something. These chatbots are becoming smarter and more personal through the use of Artificial Intelligence.
An example: A repair needs to be carried out in a building, and the tenant was to receive the mechanic today, but the mechanics were greeted by a closed door. Later, the tenant visits the website of the administrator for information, and there is a good chance they want to ask a question about the repair. Instead of waiting for the question, you can start a dialogue as a company. Proactively using a context, so that questions do not need to be asked, is the future. If questions are asked, the first-line department can be populated by chatbots while the more complex questions can be handled by employees.
5) Internet of Things (IoT) for building management
There seems to be no other technological development that building owners and managers are looking forward to as much as the ‘Internet of Things’ (IoT). Analysts from McKinsey predict that in 2025, approximately 1 billion devices will be connected to the Internet.
Using objects containing sensors that are connected to the Internet, it becomes possible to respond to real-time data, which presents opportunities. This includes the prediction of maintenance to technical installations, predicting long-term vacancy, but also tracing movements of users of an office or retail space and how these spaces can be used more efficiently by arranging them differently, for instance.
6) Image recognition of real estate objects
A form of Artificial Intelligence is accurate image recognition, a technology that is becoming more affordable and increasing in quality. The applications for image recognition are endless. It is possible to detect renovations, solar panels or asbestos on roofs based on satellite photos. This generates new information that can be valuable to appraisers, insurers, governments, energy companies, and more.
Another application of artificial intelligence is the real-time recognition of a real estate object based on a picture. People who take a picture of a real estate object automatically see all the information available for that home. This can include (historical) asking prices, estimated value, number of bedrooms, architectural data, whether the home has parking options or not, and location data. This helps home seekers and real estate professionals find the right information for every real estate object in the Netherlands faster.
But what about the practice
If you feel that the aforementioned developments sound too much like science fiction or seem to be more foe than friend, don’t worry. I do not consider the rise of artificial intelligence to be a disruptive threat to existing business models. They are new tools to reduce costs, seize new opportunities and innovate your organisation, processes and services, whereby the human dimension prevails.