The other day, I was talking with my son Chris about the changes in the real estate industry we have seen over the years. Yes, the internet was a huge advancement for the industry, and it’s constantly evolving; however, when you look at all of the excitement over artificial intelligence (AI), it’s pretty amazing to think of how it will impact our real estate industry in the years that lie ahead. My son has been studying and following AI intensely, and there are many applications that have been in use for quite some time.
There is one thing certain: technology is advancing at the rapid speed of light.
Today, practicing real estate is much faster and more complicated than when I first started in the industry in 1976. Back then, we had 75 Realtors® in the Lakes Region Board of Realtors®. Today, we have over 900. Our MLS system was archaic. Basically, every two weeks, the board office would mail each Realtor® member a packet of 5 ½” x 11 ½” sheets with one black and white photo of the new listings and pertinent listing information. A summary sheet would list pending sales, closed sales, withdrawns, and new listings. It was the agent’s obligation to insert the sheets in a 3-ring binder with tabs for waterfront, beach rights, residential, land, and commercial. Pretty simple MLS system back in those days. There were no cell phones. We used payphones while on the road with clients and children in tow. No email, faxes, high-speed color copiers, computers, DotLoop or DocuSign, ToolKit CMA’s, or social media. We used basic typewriters and letters mailed out daily with stamps, not postage machines. There was no HDR or flash ambient photography. We would have loved digital photography back then. Drone photography would have been considered science fiction, and so would Matterport 3D Tours and video tours of each property. Yes, our smartphones today are so much better than those old pay phone booths that were always jammed with nickels when you went to use them. Look at how many websites we promote our listings on today. At Roche Realty Group, we display our listing on over 80 websites.
So what’s next on the horizon for change in the real estate industry:
We are already seeing ChatGPT, Bard, Jasper, and other AI programs on a daily basis. We have seen the ability of a chatbot to generate informed responses to complex inputs. AI will become much more advanced and play a vital role in our industry.
The disruptions and efficiencies that will come with AI will require real estate agents to be constantly educated so we can adapt to these new technologies as they appear.
Here are a few changes that will likely be implemented:
- Virtual staging: AI will enhance virtual stages as we know it today. It will enhance the buyer’s experience by creating a very realistic presentation of how to furnish a property.
- Photo editing: We’re already using this; however, it will get even better in the near future. Photoshop currently allows the removal of unwanted objects from photos. In the near future, color correction, sharpness, and even lighting will likely all be handled by AI.
- Property prices and value estimates: If you think Zillow or Redfin provides decent property value estimates, wait until you see what AI’s advanced algorithms and analytics do to improve the accuracy of valuation estimates. CMAs that utilize AI will make more precisely evaluated properties. Current CMA’s only rely on listing data that has been manually input by the listing agent. With OpenAI’s new advances in multimodal applications, including analyzing what is actually within a photo, AI will soon be able to identify all of the unique features within the photos of properties on the MLS. The AI will then assign a corresponding value to each feature, such as the type/quality of hardwood floors or the quality of the kitchen in comparison to other homes that have sold within the local market. Within any set of listing photos, there are thousands of unique features that agents simply don’t currently have the capacity to reliably compare to other homes that have sold. Presently this results in agents being forced to recommend less accurate price ranges than what an AI of the future will be able to do.
- AI chat voice and chatbots: In the near future, AI voice and email assistants indistinguishable from agents will start popping up in the real estate industry, answering calls whenever an agent is unable to do so. There are already real estate companies in the US who are utilizing AI to cold call customers at a rate significantly higher than what is capable by a real human. Roche Realty does not use AI for cold calling.
- Predicting market trends: AI’s capabilities will help buyers and sellers make more informed decisions about market trends with their sophisticated algorithms. AI is capable of analyzing vast amounts of real estate data.
- Lending and mortgage advancements: This industry will see rapid changes, delivering faster, more data-driven decisions for their underwriting departments and risk management. Credit decisions will be made much quicker.
- Social media advertising: While this is already being used, this will become a more advanced tool where AI can analyze users’ behavior and preferences on various social media platforms, enabling Realtors to target potential buyers with relevant property advertisements as long as it’s in line with the Fair Housing Act. Single-property advertisements will be shared easily across social media platforms. Furthermore, agents will rely on AI to stitch together video clips quickly for attractive social media campaigns.
- Enhanced property searches: Property searches will become more streamlined. Buyers will likely be able to input images of homes or architectural features they like, and AI will assess the data and find matches easily. Furthermore, websites will automatically suggest listings that match their interests, similar to how Tiktok updates its feed.
- Property descriptions: ChatGPT already provides this feature, helping write highly effective property descriptions.
- Virtual assistants: These AI assistants will improve efficiency and enhance business by streamlining operations and improving customer service. While preventing small details from falling through the cracks.
- Office and administrative support: AI-driven automation will transform tasks like data entry, document management, and scheduling.
- Real estate leads: Some of the new platforms leverage machine learning algorithms that get smarter over time by adding new data.
- AI-generated 3D models: At Roche Realty Group, we have been utilizing Matterport 3D technology for years. This allows prospective buyers to tour a property without leaving the comfort of their home. New AI technology is in the works to make this process even more efficient.
You can see from the above how AI can impact the real estate industry. It will become a game changer as the technology evolves further. However, like many market sectors, AI is unlikely ever to replace the need for Realtors® to interact with consumers and provide that personal human touch and guidance to make an informed decision real estate.
This article was written by Frank Roche. Frank is president of Roche Realty Group with offices in Meredith and Laconia, NH, and can be reached at (603) 279-7046. Please feel free to visit www.rocherealty.com to learn more about the Lakes Region and its real estate market.