Advancements in artificial intelligence (AI) have gone from a snail’s pace to a sprint in a blink of an eye. You’ve already heard of ChatGPT by OpenAI and all the amazing things it can do. Bing, Microsoft’s search engine, has been making headlines for its potential capabilities. Google’s Bard project had a splashy introduction recently. Big Tech is racing to create the gold standard for AI.
Whether we like it or not, AI is here to stay, and it will fundamentally change real estate tech.
As you may have noticed, ChatGPT isn’t ready for prime time in real estate, not least of all because it’s only trained on data up until 2021. Real estate relies on up-to-the-minute data to power the nearly 6 million residential real estate deals in the United States every year, and comparing 2021 to 2023 is like comparing apples to oranges. Plus, MLSs, associations, and brokerages have piles of data that services like ChatGPT can’t access.
Continuous advancements in AI will allow proptech companies, MLSs, associations, franchises, brokerages, and even individual agents to glean new insights from their own vast data sets and make even better data-driven decisions. Let’s look at how.
Natural language processing (NLP) is the field of AI that allows computers to understand text and speech like human beings do, or close to it. If you’ve ever asked your GPS to find directions (or used ChatGPT), you’ve used technology powered by NLP.
The advantage of NLP is real-time data processing, which is key for our industry. But up until now, its real estate use cases have lagged behind other industries. With wider availability of NLP-powered applications and more computing power thanks to the cloud, all that is about to change.
AI applications for real estate are advancing quickly, and innovative companies are finding creative ways to harness them.
National or statewide sales trends driven by interest rate hikes, supply, and shifting consumer preferences are useful. NLP will allow even individual offices to identify their most productive niches in terms of volume and sale price from their own data lakes, without having to wait for someone else to crunch the numbers. It will also help teams supercharge their lead gen efforts by helping them identify certain lead types or predict who is likeliest to list in the next 6 months.
MLSs, associations, brokerages, and franchises are consolidating every day, and NLP is an effective way to parse through complex financial data quickly and assist M&A teams with the due diligence process, giving unprecedented visibility (and security) for these important transactions.
We all need data to set realistic and actionable business objectives. AI-powered applications will empower business leaders to make even better decisions by helping them unlock unapparent trends about their own business, their competitors’ business, and set smarter goals accordingly.
NLP isn’t perfect, and AI can make mistakes that seem perfectly obvious to anyone with a brain. So, when leaders are making important business decisions or agents are helping consumers make the biggest investments of their lives, a dose of caution, professional expertise, and intuition will help the industry avoid issues as these technologies mature.
Timely exploration, adoption, and smart use of this technology will help real estate professionals do more with less and focus even more on creating an impeccable customer experience.
At Constellation1, we’ve been building a center of data excellence for nearly 2 decades. Our experts are already working on finding the most innovative ways to apply NLP to MLS, public record, and location insight data, combining our in-house expertise with the power of AWS. Our finger is on the pulse of technology trends, and our customers trust us to keep them on the cutting edge.
Rick Herrera is Vice President of Research & Development, overseeing product and engineering for Constellation1 Data Services. Throughout his career, Rick has helped create the data pipelines powering 2 of the top 3 US real estate portals. Prior to joining Constellation1, Rick was a director at Move Inc., managing the engineering division at Realtor.com.
Originally posted on Inman.com.