Part 1: Intelligent Listings
You’ve probably heard of artificial intelligence in self-driving cars and phones, but did you know AI is also breaking into the real estate sales market?
Similar to how Facebook and Netflix use online customer behavior, real estate platforms are now adding targeting features to sell you the perfect home!
In this two-part study, we look at the benefits of using AI in buying, selling, and automating agent administrative tasks.
AI in Buyer Targeting
There are generally two ways individuals search for homes in today’s real estate market. The first is to contact a real estate agent who walks you through the search and buying process and then takes a 5-6% buying fee. The other is to tackle the search process on your own through online listings such as Zillow, Trulia, Realtor.com, and Redfin. Even so, a real estate agent is generally required for open house tours, negotiations, and contact closings.
But buyers’ options are growing. New companies are using AI are guessing you’d rather conduct your home search on a computer for a lower buying fee of 2-3%.
In fact, that’s exactly what the new AI company, REX, does. The AI company has a sourced database of homes looking to sell to consumers. Using techniques such as geographical radius, past buying behavior, recent life stages, and online presence, REX targets ideal buyers with ads on websites and social media.
It is even able to identify data nuances that real estate agents would not have access to, for example: homes in a certain area within a walking distance of a Starbucks tend to sell for 3-4% higher than other homes.
It is these types of data on the real estate market, home features, and customer’s online behavior that has allowed REX to sell 231 homes since its start in 2016.
AI in Customized Listings
So can the standard listing platforms such as Zillow and Realtor.com compete with AI companies like REX? How can they battle low buying fees and targeted listings? With the help of artificial intelligence, they are changing the way their homes are sorted and displayed to buyers.
Zillow is investing heavily in AI for its search, home recommendations, and tracking customer click behavior. This process is called Personalized Sort and it is one of the key ways the company is trying to distinguish itself from the other online real estate platforms.
I Not much has been revealed about Zillow’s new AI program, which will roll out soon, but it plans to take the “heart” button to the next level. Many of these online listing websites already have interactive elements, such as a “heart” button for favoriting homes. When a user hearts a property, it saves in your personal account, allows real estate agents to measure interest, and prompts email reminders about the property to the buyer.
Consider the possibility of allowing the user to heart certain aspects of home attributes. This feedback could be stored in their account and allow the program to generate similar homes matching those favorite characteristics. If a Zillow customer is searching in a particular neighborhood and continuously shows an interest in certain home features — year built, porches, granite countertops, new roof — the artificial intelligent system learns and displays other homes with similar accents.
In addition, Personalized Sort also will take into account non-home preferences with its recommendations, like school districts, movie theaters, and vicinity to local parks.
“No industry is untouched by the potential power of intelligent data,” says Gokul Solai, Novatio Solutions CEO. “It will be interesting to see how quickly competitors catch up to leaders in the industry who are embracing what AI can do for them.”