Artificial intelligence has grown exponentially since its first introduction only a few short years ago. A.I. is rapidly evolving and touches our lives in so many ways. Real Estate is no different. Artificial intelligence dominates the real estate industry in every aspect of buying, selling, and home financing. Artificial intelligence (AI) is the technology that replaces a manual, human process, typically saving time, money, and resources.
Especially as COVID-19 forced many companies to rethink their online and digital strategies, real estate companies embraced big data, artificial intelligence, and even virtual reality to find prospective clients, analyze property data, and ultimately, sell homes. 49% of real estate agents believe AI offers a significant opportunity for cost savings, and 43% believe it brings the chance for “massive market disruption.”
While most real estate data is public, analyzing hundreds of data points was time-consuming for the average agent. Using artificial intelligence, mortgage brokers, real estate agents, and even home buyers can make smart decisions in seconds.
Here are a few ways AI is transforming the real estate industry.
More and more consumers are turning to digital platforms when searching for a new home. The National Association of Realtors claims 88% of buyers begin their home search using online technologies. For the average homebuyer, artificial intelligence has revolutionized the home search; historically, buyers had to rely solely on agents to search for homes with their specific criteria and bring those listings to them. Now, buyers have the chance to casually browse, leading to a phenomenon called “Zillow surfing,” where people look through beautiful destination homes that they would never realistically buy.
Platforms like Compass, a real estate app used by more than 14,000 agents in 100+ US cities, implement an AI algorithm that suggests personalized property recommendations based on previous searches and buyers’ interests, saving agents and buyers both time and money.
From browsing video tours to a more detailed listing, AI gathers all this data and places it at the fingertips of a home buyer. Home buyers can quickly sort through listings by square footage, bedrooms, bathrooms, views, basements, and more. AI also recommends similar properties, offering home buyers even more options to sort through automatically with no additional research needed on their end.
AI offers home buyers control and transparency that historically was never possible. The Zillow “Zestimate” is a straightforward example – using a unique algorithm based on home features, tax assessments, and previous and current transactions, Zillow calculates an automated estimated appraisal. Zillow launched Zestimates in 2006 and now tracks the value of over 100 million homes.
Big data even brings a new level of optimization to the home appraisal process; for example, a property value increases if there are two grocery stores within walking distance but decreases if there are more than four. This detailed info is delivered to a potential homebuyer through even more AI in the form of a Zestimate.
Historically, real estate agents might have put together this appraisal using comparison data from similar homes, locations, housing market trends, and recently sold property values.
Agent Lead Generation
AI also offers the opportunity for increased revenue with reduced costs for agents. Sales and marketing workflows can happen automatically using CRM platforms like Hubspot, where agents can stay in constant contact with clients on market trends, new home listings, and even home maintenance tips. AI platforms like Hubspot can track user activity, link clicks, and time spent reading emails to give agents more data on their client’s interests.
AI helps agents increase productivity, track and engage with leads, and nurture existing client relationships. Real estate professionals can store all their contacts, deal information, and more in a single, automated online platform.
Real estate agents have more tools than ever to showcase the value of their listing. Agents can use social sharing, drone photography, listing syndication, 3D walkthroughs, and video tours to enhance their property listing online. Homes with virtual tours sold 6% faster than those without, and buyers prefer these AI technologies, too; web visitors remain on a website 5 to 10 times longer if there is a virtual tour.
Again, AI offers buyers the chance to shop around for the best mortgage rates from the comfort of their homes. The mortgage process is historically time-consuming and difficult with tons of paperwork, but AI streamlines both the application process and the search for the best rates.
For example, Bank of America implemented AI to help automatically fill out fields in its mortgage application. Within one year, its loan originations increased by 6%, and its closing time shrunk to 20 days.
Artificial Intelligence Offers the Chance to Also Transform the Escrow Settlement Process
AI offers the real estate industry a chance to streamline and automate, generate more revenue, and create a more transparent experience for both buyers and agents. From home browsing to the appraisal process, property showcasing, and mortgage shopping, artificial intelligence stands poised to benefit everyone involved.
New Venture Escrow understands the importance of investing in technology to improve the escrow experience. That is why we are proud to introduce to you, our new intelligent messaging agent – Vinny. Buyers, sellers, and agents can now fully engage with Vinny to get their questions answered, receive live updates and schedule tasks. Please contact us today to learn more about how our investments in technology will make your escrow experience more transparent, convenient, and stress-free.