Rise of Virtual Real Estate Agents
Artificial intelligence (AI) is revolutionizing real estate, with tools such as 3D virtual tour software CAPTUR3D and automated value estimation tech Zestimate already transforming the nature of an agent’s work. The question is whether AI can replace real estate agents.
The answer lies in AI’s potential to combine with human intelligence and skills. Computers and robots can be used right across the real estate value chain to improve processes by absorbing huge amounts of data and creating insights from it. Then it’s up to people to make the most of the value this creates.
Exploring the options
There’s an array of tech that agents can already use. Tools such as computer vision can analyze images such as aerial photographs to identify the condition of a building. Geographic information systems (GIS) can scrutinize geographical data such as maps and satellite imagery, to identify patterns and trends across an area. Predictive analytics can forecast future demand trends, to identify areas where house price growth is likely.
Natural language processing (NLP) can be used to investigate social media and other online data sources to identify buyer preferences. The NLP tool that’s likely to get the most attention this year is called ChatGPT. This is a chatbot that responds to questions, queries and requests much like a human can, drawing on mammoth banks of data. Its ability to learn is exponential.
“For real estate agents, tools like ChatGPT are able to generate more value from the extensive knowledge agents have of their portfolios. For example, it can quickly create property descriptions from a simple prompt with basic parameters,” Melbourne tech studio Phoria chief executive Trent Clews-de Castella says.
Giving ChatGPT a task …
And the AI’s response…
Clews-de Castella says AI tools such as ChatGPT will be able to cut down the hours agents spend creating compelling listings. This is time that can be repurposed with potential and current vendors and buyers.
“AI is capable of a lot more than just writing listings for agents. It can help prepare legal documents and monitor lead generation for property listings. It can digest big data sets and identify trends like demographics and crime rates; patterns that can impact the desirability of an area and marketing strategies.”
For example, if AI can show a suburb is demographically skewed towards young families, then agents can make sure marketing for properties in that suburb showcases schools, parks and other family-friendly features.
All of this can be integrated with a web-based application and used by agents to make data-driven decisions. The beauty of these tools is that as their capabilities evolve, we’ll discover new and innovative ways to use them,” says Clews-de Castella.
Aside from estimating house prices, commercial property development and finance firm Salvest managing director Anthony Ferraro expects AI to be used to estimate rental growth and consumers’ debt levels for home financing. He says tech will shake up the industry in a number of other ways.
“Speech recognition can assist the sales process by gathering data to measure the stress and emotional levels of vendors and buyers. This can provide the agent with resources to close the sale. We will also see virtual agents emerge, where the vendor becomes the agent, drawing on machine learning to assist in the buyer qualification process.
Should agents be worried?
While agents reject the notion they will be replaced by AI, some of the tasks they are accustomed to performing will be done by machines in the future.
Clews-de Castella acknowledges AI has the edge on agents in some respects. “AI is fast, cheap and accessible. It can help remove emotional biases from one of the most stressful decisions buyers make. But what agents bring is empathy. They understand your story, what matters to you, what motivates you and what they can do to support you. It’s that human interface for which an AI platform isn’t a substitute. “Yet.”
Similarly, BeKonstructive Marketing managing director Bek Drayton says there’s a lot more to being a real estate agent than creating basic property listings, which can be done by a robot.
“Smart agents will use AI to create the base of their listings and present the facts. Then it’s up to the agent to edit and weave a story through the listing that builds an emotional connection with the reader. This will mean agents can spend more time building relationships with clients.”
Undercover Agent founder Chris Bellesini sees AI as a marketing tool that may shake up property sales, before becoming just another part of the property buying and selling process.
“There’s been considerable advancement in technology in the real estate industry, but trends come and go.
“Large portals such as realestate.com.au and domain.com.au know what we are looking for and are very clever in showing us properties that may suit our needs. What they don’t know is your emotional connection to a property or whether you want to buy it because you already own the block next door, so you would be prepared to pay more.
Also, people sell infrequently, so although they may not want to use an agent, they are comfortable with them. Let’s face it, agents don’t want to be replaced and whenever challenged they have been able to prove their worth.”
He cites Purple Bricks, a UK online real estate agent with a flat fee rather than commission-based model, as an example of a business that wanted to shake up the sector, claiming traditional agents were overrated and overpaid. “In Australia they lasted about 18 months.”
Bellesini believes there’s a range of reasons real estate agents still have a future.
“AI will not have all the data needed to know what a buyer is prepared to spend on a property.
“A skilled agent can also note conversations of importance to extract the best price and read body language and tone to pick the handful of potential buyers out of a group of, say, 30 acquirers pretty quickly.”
Additionally, he notes vendors feel more confident having a professional on their team when dealing with their largest asset. “Selling is a stressful process and having a human to deliver information and know what to do next is important.”
Ultimately, rather than thinking about how technology can replace agents, it’s probably better to look at how technology can enhance the work they do.
AI can be an invaluable tool to streamline the journey to sell a property and to empower buyers to make the most informed decisions possible. So agents can rest easy; they are unlikely to be completely replaced by a machine.
For the moment.
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