AI, or Artificial Intelligence, is playing a big part in many aspects of our lives. AI-based innovation is predicted to lead economic growth by 2030.
The real estate industry will be impacted as software algorithms evolve to expand into more complex areas. These areas include voice recognition and decision making. AI could significantly reduce incorrect decisions due to a lack of data.
AI is a wide-ranging term for smart technologies that learn to ‘understand’ their environment and respond autonomously to signals and make decisions. These are computer applications that are able to learn, understand, plan, think and self-correct.
However, a question we might ponder is whether AI will replace real estate agents or not? And would you use AI to either buy or sell a home or real estate investment?
So far, trends within the industry suggest no. Buying and selling a house is a very personal experience and the likelihood of AI replacing real estate agents altogether is low.
There are suggestions that this may not always be so, however it’s an interesting question and between the lines there’s lots of pros and cons to reflect.
Reading between the lines there’s lots of interesting trends and experiences to consider that can help answer these questions, or at least paint some context to think about.
The real estate industry has a record of embracing technology. We’ve been addicted to online real estate listings and portals for more than 26 years. It sometimes appears that consumers love browsing these sites, even when they have no intention of buying. After all, dreaming of your ideal home is a free pastime.
Our world-class conveyancing system is almost fully automated and online digital property tours are no longer a novelty. Property valuations are more accurate and greatly enhanced by technology and when it’s necessary to find and consider lots of relevant valuation related data AI is an obvious application.
However, when AI interacts with broadly based consumers for almost any product or service, the picture is less clear.
At a Google developer’s conference held in 2018 the audience was played an interaction between Google Assist and a real person to make a hairdressing appointment. The resulting ‘conversation’ was very real and amusing and has entered tech-folk law.
We’ve all experienced some very basic human to machine interactions like making a phone call and being asked to select endless options .. for this or that service press a number and then #.
Or those ‘can I help’ pop-ups on websites that are basic AI connections and are currently less than helpful unless there’s a real person on the line.
However, more broadly we do already use AI or machine-learning every time we do a Google search.
More than 95% of consumers generally start their search for information, services and products, on Google. It’s also where the vast majority of our customers, estimated at 75%, go to start a property search and so AI is already central to our industry.
But despite our fondness for and use of technology and the importance of Google search, making the leap to a fully automated AI based property transaction looks ambitious.
It’s a topic I first addressed in 2013 and centres around ‘emotion’ and the value of personal service.
Both a buyer’s and seller’s experience in the real estate market involves a good measure of emotion and it is the main reason many consumers place so much emphasis on the level of service they receive from their individual real estate agent.
This sensitivity to personal service is one reason personality is widely promoted by individuals and agency groups.
In an environment where real estate has to compete just like any other product or service, a great deal of effort and money is spent to build brands. As a result how customers view their buying experience and the feedback they give is taken to heart.
Buyers and sellers need to make a personal, even emotive, connection with the individual they are dealing with and this is often highlighted in research. Consumers look for reassurance, guidance, trust and empathy – tough value for AI to match.
We are all conscious of the basic tools and systems we use to market and sell property and while AI is of great value in areas such as valuation and development planning, face-to-face sales I believe still require a personal touch that AI cannot deliver.
However, I appreciate that technology is always on the move, something that COVID has put into even sharper focus, and as an industry we need to have a solid communications strategy with our clients that fully serves our market while AI lurks in the wings.