Smart Data and Artificial Intelligence: cutting-edge technology for real estate valuations
24/02/2022 · Autor: Wolfram Gast, Chief Digital Officer
Highly developed data models and analysis methods are now providing a new level of precision in the price assessment of real estate properties. In this article, you will learn what role data points and artificial intelligence play in this process and what the optimal interaction of digital and personal consulting looks like for us.
The most important thing in advance:
- Today, much more 'smart data', i.e. authoritative information, is available for real estate valuations through digital data collection.
- Advisors like ours are already working with a software solution that evaluates a variety of information using artificial intelligence.
- Precise evaluations provide more transparency in the real estate market and thus more efficiency in the mediation process.
Smart Data: Challenge and Opportunity
Digitalization offers us new opportunities in many areas of life today. How different the added values for the user can be is also evident in the real estate world. On the one hand: a new viewing experience through innovative technologies in marketing - for example, through 360-degree tours, virtual viewing glasses or viewing robots, which are already being used selectively by our consultants.
On the other hand: a new level of precision in real estate valuations through data-driven analyses that take into account almost all influencing factors. This is based on data from the past with daily updated information and forward-looking analyses. The questions are now: What is the property worth today and how will the price develop in the future? To find a valid answer to these questions, one thing is needed above all: the right data - often summarized under the term "smart data". This refers to the systematically filtered data points from the total amount of data that consumers, users and companies voluntarily disclose about themselves.
Digital data sets and real estate valuations
It is estimated that by 2025 the amount of digitally available data will have increased more than fivefold. So what does this mean for real estate valuations? One thing is clear: information on year of construction, size and location was and remains important in this context. Today, however, we know that there are many other general conditions and information that have a significant influence on the price level of an apartment, house or property. On the one hand the general market development has a decisive effect.
In addition come however also factors such as infrastructure, binding to the public local traffic, available and outstanding building permits, existing objects of interest or cultural points of attraction, socio-economic and geographic data to the residential environment as well as information over individual comparison real estates. One thing is certain: More data is now available in the real estate industry than it is even possible for people to process and meaningfully evaluate without technological assistance. "Smart data" is therefore both an opportunity and a challenge.
Artificial intelligence: precision as a goal
A large amount of data alone is not enough to arrive at more precise results when evaluating real estate. By means of artificial intelligence, these enormous knowledge potentials must also be made usable. What lies behind this are essentially software solutions that are programmed to store a large amount of data, learn about it and thus optimize themselves.
Together with highly complex data-driven valuation models, valid statements can thus be made for the future - and this is precisely where it gets exciting for real estate valuations. For example, effects of urban developments can thus be identified at an early stage and taken into account accordingly. The determined market price thus becomes considerably more precise.
Conclusion: Advantages for all market participants
If real estate is valued more precisely, this has a number of positive effects. The most important: Artificial intelligence ensures that real estate valuations can now also take into account the specific conditions, developments and opportunities on site. In other words, it is no longer the location or site alone that is decisive, but all relevant local conditions. In addition, more realistic prices also ensure a much more transparent market.
Properties can be compared better, i.e. more realistically, and decisions can be made on a sound information basis. Thus all profit in the end: owners, buyers, brokers. The brokerage process becomes more efficient and everyone reaches their goal faster. Conclusion: efficiency and speed - the two greatest added values of digitization - thus also come into play in the area of data-driven real estate valuations.
Brokerage houses such as VON POLL, which are moving with the times, already rely on such technology-based valuations and equip all stores and brokers centrally with a highly developed, data-driven solution whose information is evaluated by means of artificial intelligence. Together with many years of personal regional market expertise, they thus form the foundation of our work in modern real estate brokerage. However, the "human factor" still has the highest priority. The conviction is and remains: In the course of a personal consultation individual questions and desires can be discussed around the topic real estate evaluation and marketing still best.