The intersection of AI and PropTech


Oct 29 | 7 minutes read
The intersection of AI and PropTech

As with the majority of industries today, real estate will undergo a transformation as part of what is known as 4IR (The Fourth Industrial Revolution).

This shift will have varying effects on the property industry's many business verticals. Introducing innovative technology to real estate agents, such as improved seller/buyer matching, smart building technology for property managers, intelligent analytics for investors, and automation for builders.

 

Real Estate

High Street Estate Agencies are fighting to stay competitive with online agents. The low-cost models of internet agents are appealing. However, the human agent's personal and frequently intelligent assistance is still a crucial aspect in completing the deal. In his quest to sell his property, industry expert James Dearsley has set the two options against each other.

Can AI truly be used to assist the Human Agent in fighting back? Working alongside an AI assistant may seem contradictory, but working alongside an AI assistant may be the future for high street agencies. Regardless of the agent's education and experience, humans will never have the capacity of a machine to consume massive volumes of data, remember it, analyse it, and derive patterns from it. Take, for example, Houseprice.ai, which claims that their "RMSE model is an industry-leading 2.6%, indicating our middlemost forecasted price is only 2.6% off the actual sales price."

It is also extremely likely that we will be able to supplement the intrinsic knowledge of the agents with the smart matching of buyers with properties using Machine Learning and Pattern Recognition. In 2016, an experiment was conducted in Denver that pitted a bot against a real estate salesperson when it came to selecting homes for buyers. The bot was victorious.

When this knowledge is combined with solid sales abilities, the new tech-savvy high street agency becomes a future-proofed institution that makes use of well-trained, helpful, and attentive sales employees. Agents equipped with massive volumes of correct information supplied in real time, with AI assistants operating in the background, are a very possible short-term future scenario.

Combine this with the newest breakthroughs in Virtual and Augmented Reality, and viewings might be quick and tailored to the buyer's demands. Then provide the agent with the latest gadgets, such as mobile technology, smart glasses, wearables, and so on, and the need for the costs associated with the high street office become less important, as we move to a world where the best agents thrive on their ability to use data effectively to their advantage and their ability to create relationships that turn into sales (AI is still a long way off).

AI assistant

 

Developers and Investors

Financial investing is based on data, modeling, and analytics. However, property investors have historically managed their investments using programmes such as Excel or software such as Argus. The complicated analytics used by financial investors obscure these simple modeling tools. Property investors can now develop deeper and more complicated investment models because of the widespread availability of AI tools.

Does this imply that they can delegate decision-making to robots? No, since, despite its name, Artificial Intelligence lacks true intelligence. This is still the domain of humans, and it will remain so for some time despite the fanfare. REalyse, for example, provides investors with historical trends dating back to 1995, allowing them to be more efficient in discovering investment opportunities, such as rental and sales values, yields, and demographic data.

Right now, AI has not made much progress in this field, and it is possible that the value of AI will not be realized in this area. AI has yet to prove itself as a dependable investment instrument for financial market investments; AI technologies have been unable to replicate Warren Buffet's investment techniques. "Some individuals make rich studying artificial intelligence," Carl Icahn said. "I make a living by researching natural stupidity."

 

Managers and Surveyors

This is one area where AI is expected to have a significant impact. According to a 2017 RICS assessment, there are 42 surveying functions, 11 of which are very sensitive to technology improvements right now and another 7 that will be vulnerable over the next decade, while a further 22 are likely to be influenced in some manner.

Management, organization, physical maintenance, strategy, sales, and opinions are all functions that will demand strong human attributes throughout the next decade.

The most significant changes will be in appraisals and valuations, cost estimation, property information, maintenance planning, lease management, report and legal documentation preparation, risk assessment, and space management and analysis.

While we have already seen how valuations in the residential sector have been influenced, we can expect a similar impact in the business sector.

Combining IoT (Internet of Things) devices, such as sensors and cameras, can give data that is useful for both property maintenance and management. These technologies can also be utilised to provide comprehensive insights into space management, such as understanding how people interact with buildings. This information can then be used to assist set rental pricing for shops or service providers who use the space. By incorporating AI into the data collected by the IoT platform, predictive models may be constructed to aid in both preventative maintenance and future development.

lot

 

Architects and contractors

Construction is one sector where we may anticipate robots taking on human roles. As the need for new construction rises, so does the skill shortfall. Meeting house building ambitions in the UK alone, according to Arcadis, will necessitate the hiring of 400,000 new construction workers per year between now and 2021.

Robotic technology may assist to alleviate some of this demand, and there are real-world examples of robotic manufacturing pre-building major structural components for on-site assembly.

In May 2018, US business ICON revealed the construction of a 650 square-foot home using a 3D printer, and last year Russian company Apis-Cor announced a similar project created in the tough Russian winter circumstances. Construction Robotics of the United States has developed bricklaying robots capable of laying 2000 bricks each day, compared to 400 by an average bricklayer. While the extent of these early-stage initiatives is certainly restricted, they clearly foreshadow a significant transformation in the building industry.

The possibility of automating the architectural process is less feasible, and the human factor remains important in most aspects. According to Patrick Hebron, a user experience designer at Adobe Systems and adjunct graduate lecturer at New York University, the human aspect is critical, as machine-only designs would result in an "unlivable built environment." The revolution for architects, on the other hand, will revolve around the collection and use of data to assist drive successful design and the automation of repetitive chores that slow down the design process. These modifications will aid in increasing the speed and efficiency with which architects may provide their designs.

Robotic technology

 

Information produced from the use of IoT in conjunction with AI can be utilized to provide more information to architects in order to assist them construct the most effective designs and utilization of space.

The tools used by architects are likewise incorporating AI into their basic functions. LunchBoxML, which provides Machine Learning capabilities, is now included as part of the LunchBox plug-in for Grasshopper and Dynamo, further improving this popular design tool.

The property industry has always been sluggish to adopt new technology; nonetheless, the recent wave of 'intelligent' technical breakthroughs has significant ramifications for enterprises' ability to compete. With so many organizations in the industry today actively changing the way they do business and produce results, those who do not evolve risk being left behind.

People skills, on the other hand, are as crucial as ever. Good salespeople can develop human relationships; sense a bargain where others see failure; solve intricate challenges that only appear when you are halfway through a task; or simply know what people enjoy instinctively. All of these examples of natural human intelligence will continue to be incredibly significant assets to their respective businesses. However, AI will change the way they work, and those who can swiftly adapt to those changes, coupled with their inherent skills, will have the best chance of future success.

While information technology (IT) remains a function within all businesses, 'technology' is increasingly becoming a new function that must be addressed. This varies from IT in that it is not about tools that enable it, such as email and printers, but rather tools that enhance or change the real business function, which necessitates a different type of technological background to define, create, and deliver. A role that combines a clear understanding of the business function with a deep understanding of technology.


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