The real estate market can feel the changes and impact of artificial intelligence (AI). But when it comes to making perhaps the most important purchase of one’s life, homebuyers will want that human touch, experts told Fox News Digital.
“I don’t think it’s going to replace how we do business necessarily and automate it, but I think it will increase the amount of data we have,” said Pierre Debas, co-managing partner at Romer Debas LLP.
He argued that this would allow Realtors to “provide consumers with more accurate information and perhaps a broader range of data in making their decisions when buying a home.”
AI has already reshaped many industries, including the one that created it, leading to rapidly shrinking job opportunities and doomsday predictions of no more tech jobs in five years. And real estate is no exception.
Real estate agent Shelley Young from Home & Business Realty Inc. works on a “For Sale” sign in front of a home on December 22, 2009 in Miami, Fla. (Joe Riddle/Getty Images)
Real estate broker eXp Realty LLC issued a press release this month announcing plans to hire AI-certified agents. Agents will work with AI to learn how to best optimize it to empower homebuyers and realtors alike.
Real estate, like most industries, wants to focus on the human element in the process, and Debas and Kristen Jordan, a real estate advisor at Douglas Elliman, stress that people may not feel comfortable trusting AI with such an important lifetime purchase for years.
“You want to trust $400,000 of equity that’s your largest nest egg with a robot? I just don’t see people wanting to do that,” Jordan said, comparing the potential experience of an AI realtor to automated customer service from Amazon or Google.
“It’s terrible with any people,” he added. “For the public, things will change a bit” with AI. But for those still looking for “luxury,” they’ll want to “talk to a real person.”
Debas discussed the benefits of AI as a data processor, the most common use in industries outside of tech, in addition to using computer vision to produce more actionable results.
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In the housing industry, realtors have to handle many houses or properties in their area. But they also have to deal with market demands and government requirements and changes in interest rates and changes in purchasing power among potential homeowners.
He also highlighted examples of previous companies trying to use AI to automate the buying and selling of homes in the recent past, only to lose money in the process.
A billboard seen near the Copley Square T station facing Columbus Avenue. (John Tilmacki/Boston Globe via Getty Images)
“A lot of companies have tried to do that … in terms of switching brokerages,” Debas said. “Every time you do this … on an automated algorithm for investors to buy tens of millions of homes, and they all fail.
“Zillow has one The popular iBuying program God knows how many thousands of houses he bought. And the program lost millions of dollars, and they shut it down a year or two ago. I think it just goes to show you that in the residential housing market, the human element that provides, technology can’t replace that. … In terms of real estate valuation, residential real estate valuation is very subjective.”
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iBuy Program The plan is to flip houses using an algorithm to estimate the home’s value and determine what home sellers should pay. But Zillow said it had to shut down the business because it couldn’t accurately predict future home prices and was losing too much money.
The house flip cost the company $500 million and laid off a quarter of its staff.
Zillow Inc. and Trulia Inc. App icons are displayed on an iPhone on July 25, 2014 in Washington, DC. (Andrew Herrer/Bloomberg via Getty Images)
“People want to have a personal connection when they buy a home, and I believe that when people are selling expensive assets that they’ve invested a ton of money in … I don’t know that they’re ever going to trust a robot to get top dollar for the sale,” Jordan said.
“But that being said, all agents and all small firms have to learn to adapt and move forward with what is.”
Both experts said the biggest changes are likely to occur in cities, where the greater volume and diversity of real estate will require a faster rate of adoption to differentiate and stay ahead of the competition.
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“Right now… interest rates have more than doubled in a year, but prices have come down a lot. But in many parts of the country, it hasn’t even come down.” Debas noted. “What does that do for the lower to middle class?”
“Families… will live in the rental for the rest of their lives,” he added. “It’s a problem that no one is talking about. And if we’re going to expand it. Wall Street Competence To continue to acquire more homes in a more efficient manner, it will really compound the problem.”
Source by [Fox News]
