Embracing the AI opportunity

Embracing the AI opportunity

13 February 2020

By Helen Hull

Artificial Intelligence. Two words that strike fear into the hearts of many. Hollywood sci-fi movies have given us visions of super intelligent robots out to destroy humankind. But reality is far removed from this silver screen interpretation and AI is set to play a critical role in the success of real estate agents – today, tomorrow and into the future.

“Artificial Intelligence dates back to the dawn of computers in the 1950s,” Alister Maple-Brown, CEO of Rockend, said. “However, in recent times it’s become a much-overused term and is essentially used as a catch-all phrase for a whole range of computing capabilities – from basic automation to progressive learning to predictive analytics.

“AI is all about using computers and software to do things for us. The ability to learn and recognise patterns enables computers to progressively act more and more like humans, doing work for us that doesn’t require decision making and thinking.”

Despite the ability to be faster and more accurate than humans, Mr Maple-Brown said robots are not coming to take away jobs in the real estate industry.

“AI will, in fact, remove the thankless, boring and mundane tasks, providing agents with the opportunity to focus on human interaction,” he explained.

“The beauty of AI is that the machine gets smarter with every interaction and without the need for any additional coding or system changes,” he said. “This means the machine can do a task or series of tasks more quickly and with a greater degree of accuracy than a human.”

“AI provides the opportunity for real estate agents to look at ways to automate their services, and leverage both their own data and external datasets. It’s because of the scale and capability of the data that can be aggregated that we’re now seeing AI really come to the fore.”

- Alister Maple-Brown, CEO at Rockend

Quantity and quality

Chris Rolls, Managing Director at PieLAB Venture Partners, said one of the main issues facing agents today is that they have lots of data.

“An agent might have 1,000 contacts in their database, but they only call the 50 people they know best because they’re keen to avoid rejection,” he explained. “Artificial Intelligence can help agents overcome this, and access and leverage their entire database.

“Take Rita, for example, Aire’s artificial intelligence platform. Rita goes through your data and provides reasons to make calls to particular database contacts.

“By analysing your database and external data sources, Rita can see that you sold 10 Smith Street a few years ago and a competing agent has just listed 12 Smith Street. Rita will alert you to call the owner of 10 Smith Street and let them know that 12 Smith Street is on the market, reminding them that you sold them their home.

“Importantly, you now have a reason to call a client, because Rita is comparing information from a number of sources and applying it intelligently to your database.”

Rob Ward, CEO of DiJONES Real Estate, emphasised that AI frees up time so agents can focus on having quality discussions, such as qualifying buyers and tenants.

“For example, if you think about what bogs down a property manager, it’s the constant barrage of calls, emails and other enquiries. ‘Is the tenant up to date with their rent?’ ‘When does my lease end?’ ‘How long until the repair is done?’

“In our business, we’re using Rita to answer these types of questions.

“Rita interprets the environment, searches our database and then comes back to the client in four minutes. It’s faster and more consistent than a human and ensures that we’re providing a good client experience.

“Once something is done more than three times by a human, it needs a system. Clients don’t want to talk to someone unless they have to. And they don’t want to jump through lots of hoops. So why not use systems that allow clients to get the answers they need, quickly and accurately.”

Mr Ward said once agents understand that AI is there to help not hinder, they’ll be quick to embrace it.

“With any change comes fear,” he said. “But when agents see the benefit, they’ll recognise the need to adapt their behaviour and replace repetitive tasks with activities that are more dollar productive.”

“Implementing AI can potentially change the career trajectory of property managers, so they’re in a growth role with a career path, rather than a relentless, process driven, admin-based role.

- Patrick Hill, CEO & Lead Technologist at Realm

Flow on benefits

As well as achieving efficiencies, Realm’s Patrick Hill believes that AI can positively add to the collective mental health of agencies and reduce conflict, stress and fatigue – particularly for property managers.

“We’re currently looking at a 60-70 per cent attrition rate in property management, and agency leaders need to seriously consider both the physical and mental health of those in their team,” he said.

“If AI can reduce some of the burden, while still providing a quality service, that has to be a good thing. Implementing AI can potentially change the career trajectory of property managers, so they’re in a growth role with a career path, rather than a relentless, process driven, admin-based role.

“AI can help to align the needs of the agency with the needs of the agent and, in turn, may help stem industry drop-out rates.”

Embracing AI

“AI is not something to be feared. There’s no need to have a deep understanding of the coding or technology behind it. You simply need to understand how it enhances processes and, by so doing, improves your bottom line.”

- Douglas Driscoll, CEO at Starr Partners

Starr Partners CEO Douglas Driscoll said the real estate profession can’t fight AI – it’s here to stay.

“We’ve been very slow as an industry to understand and embrace AI,” he said. “But we have to prepare for automation to become the standard.

“The reality is that AI does a better job. It gets things done here and now. It doesn’t wait until after lunch. It doesn’t make spelling mistakes. And it doesn’t come into work with a hangover!

“AI is essentially ‘set and forget.’

“Agencies that don’t embrace AI will suffer, because their competitors and other new players who embrace and better understand the new environment will overtake and replace them.

“I believe that as a result of AI, there will be fewer real estate agencies. But AI also gives us the opportunity to keenly focus on our role in the real estate process.”

Notwithstanding this, Mr Driscoll said AI won’t replace the emotional element of the transaction.

“Emotional management, stress management and the reassurance that only agents can provide – no algorithm can do that at the moment.”

Reap the benefits

Sarah Bell, Co-founder of AIRE and Rita’s ‘mum’, believes that these days there’s little tangible difference between brands – but emergent technology can allow you to differentiate yourself.

“As real estate agents, we’ve gone down the path of all using the same digital tools and, without relationships, it makes it difficult to stand out,” she said. “But adopting AI gives you the ability to handle volume and scale. You can focus on optimising your service to align with what your clients value. What this gives you is the power to take a strategic position. This represents a significant competitive advantage.”

According to Ms Bell, AI provides a collective intelligence approach to doing business.

“We have to look at what our function is as professional service providers and, in our service design, what parts of the service can be automated, what parts benefit from collaboration between humans and AI, and then what parts should be left to agents.

“Agents should be focused on doing human activities related to judgement. AI allows agents to move away from their screens and put themselves in front of clients. They don’t need to be a servant to scrolling through data.”

Starr Partners’ Douglas Driscoll agrees and said that, as businesses, we should be more like organisms rather than organisations – constantly evolving and adapting to our environment.

“People want to do business on their own terms,” he explained. “Sometimes they want to have conversations at 10pm at night. They’re time poor and want to be able to engage 24 hours a day, seven days a week and 365 days a year. They want to be able to ask questions and hold conversations at any time that suits them.”

Profitability and productivity

Brett Hunter, Principal at Raine & Horne Terrigal – Avoca Beach, said agents shouldn’t fear AI.

“Normally when you implement software, it’s a significant issue, because it takes lots of time and human capital,” he said. “But implementing AI is not that sort of software implementation. The AI we’ve implemented works over the top of our existing databases.

“Don’t look at it like the migration of your CRM from one provider to another. Think of it as if you’re supercharging your existing systems – and doing it overnight.”

Mr Hunter said AI is for agents who want to take their business to higher levels of profitability and efficiency.

“Anywhere a human is touching a process and not adding value, AI can step in,” he explained. “The benefits we’ve experienced are related to client service and provide a means for us to do what we do better.

“For example, Claire, Realm’s property assistant, takes over many administrative tasks and has conversations (via SMS and email) with our clients 24/7. Claire runs our concierge service, which allows tenants to talk directly to our database and obtain the information they need, when they need it.

“The human touch is still required. Agents need to do the emotional work and handholding that’s required, so AI certainly won’t make agents redundant. But it will make us more efficient. We’ll be able to operate at a higher and more efficient level.”

Mr Hunter said that as productivity rises through the use of AI, roles will change.

“A property manager who has 130-160 properties under management can potentially increase that number to 220, all while providing the same level of service. AI will support a shift to higher levels of service and greater responsibilities for property managers. This will, in turn, lead to enhanced professionalism and increased salaries (in line with investment portfolio managers), paid on asset growth, yields and performance.”

“Adopting AI gives you the ability to handle volume and scale. You can focus on optimising your service to align with what your clients value. What this gives you is the power to take a strategic position.”

- Sarah Bell, Co-founder of AIRE

Adapt for the future

PieLAB’s Chris Rolls encouraged agencies to be adaptive and understand the products and services that are out there.

“Don’t be left behind,” he said. “Gone are the days where you learn everything you need to know at school or university. The world is changing so quickly. We all need to adapt and keep learning.”

Starr Partners’ Douglas Driscoll said smaller agencies may think they need an in-depth understanding of AI in order to implement it, but nothing could be further from the truth.

“AI should only be complex in the back end, not the front end,” he said. “It should be so simple that agents from their 20s to their 70s can use it.

“AI is not something to be feared. There’s no need to have a deep understanding of the coding or technology behind it. You simply need to understand how it enhances processes and, by so doing, improves your bottom line.”

How AI can help

The sheer volume of data available to real estate agents today is astonishing. Yes, it offers a wealth of potential. But equally, it can be overwhelming and complex.

The power of Artificial Intelligence lies in its ability to take huge amounts of data from various sources and turn it into opportunities that make it easier for agents to convert clients.

The power of data

Here are just a few of the ways AI is having an impact on the real estate industry right now:

  • Collecting and using data. No matter how hard you try to keep your database up to date, there will always be outdated records and missing information. AI can analyse and compare large datasets, identify data that is out of date or incomplete, and fill in the blanks.
  • Connecting with clients. With a clean database, AI can then use data to create profiles that enable the generation of communications that are customised for each individual client. Also, by setting parameters, AI can generate lead lists for follow up.
  • Creating efficiencies. AI can automate processes, saving time and resources. Time consuming, labour intensive tasks are taken care of, freeing up agents to work on relationships with current and prospective clients.

More to come

AI is already powerful, but it will be even more so in the future. The possibilities are mind boggling! Here are just a few things that are already well and truly on the way to becoming a reality:

  • Prediction of property values
  • Recommending properties that align with clients’ preferences
  • Facilitating property inspections without an agent by using Virtual Reality and Augmented Reality technology
  • Streamlining the buying and selling processes, with faster and easier settlement and contractual approval.
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