Businesses across different industries are leveraging Big Data – that is huge volumes of data collected from search engines, social media, and other non-conventional sources – to bring improvements in many business aspects.
With Big Data analysis, businesses enjoy streamlined resources management, increased operational efficiencies, growth opportunities, expedited and smart decision-making, and optimized product development among other benefits.
It is no different in the real estate sector, the transformation is clear. Companies, investors, sellers, and buyers are embracing Big Data using this type of data to build algorithm models and predictive analyses to remove the guesswork. As a result, they are reaching predictions that are more accurate. Moreover, these predictions are bringing several benefits to the stakeholders.
Here are 5 ways leveraging Big Data is revolutionizing the real estate industry.
1. More Accurate Property Evaluation
When introducing property in the market, pricing it correctly is crucial in the real estate industry. Real estate professionals often relied on their expertise and experience to manually appraise a home. This meant performing a comparative market analysis based on factors such as the proximity to schools, institutions, and other amenities as well as the prices of other properties in the neighborhood.
However, Big Data and AI are allowing these professionals to evaluate properties more accurately based on the current trends and other additional information. Unlike manual appraisal which compares just a few properties, big data can analyze thousands of similar properties. Big Data gives better insights into the market to help evaluators understand the markets in-depth.
In addition, Big Data technology helps remove inconsistencies brought about by dependency on many data sources. The technology is able to bring all these data sets together to help reach a transparent and objective figure.
2. Improved Marketing Strategies
When it comes to marketing, the more targeted a strategy is, the better.
With Big Data, property agents get access to valuable insights about what prospective buyers are looking for in properties. In addition, agents can be able to identify buyers’ demographics by gender, age, region, preferences, interests, career objectives, and more to help them create more targeted advertising campaigns. For instance, agents can be able to tell that a customer has young children or pets. With such information, agents focus on properties in pet-friendly neighborhoods as well as those close to schools. Likewise, with insights on career aspirations and standard of living, agents can help prospective buyers to locate properties that match what they are looking for.
Big Data is mostly transforming the luxury homes market in this regard. This is where prospective buyers are looking more into what features the homes have to offer, as compared to specific locations.
3. Enhanced Property Development
Big Data analytics is helping developers and real estate company owners maximize profit margins through improved property development.
Stakeholders are analyzing data sets to identify areas that promise the highest profits for development. For instance, by analyzing government records, they are able to identify areas marked for infrastructure improvements. Likewise, by looking at trends on social media, they can gain insights on, say, an increased interest in a particular area by a particular demographic.
Additionally, by going through an apartment market survey, investors can be able to analyze property occupancy by comparing occupancy rates in the past versus future predictions. This helps them identify areas with high occupancy rates for their future investments.
In addition to identifying the best places to invest in, investors can use market analysis reports and follow social media trends to determine what residents in multifamily properties are looking for.
4. Better Decision-Making
AI and Big Data are transforming the real estate industry by enabling faster and better decision-making for both customers and real estate business owners.
For instance, Big Data delivers all the information a customer might need about a property. This can include crime rates, school zone data, home value graphs, and more. With access to such information, they can make the decision to buy or not faster and from a point of knowledge.
Likewise, investors can be able to look at the property’s past data such as how the property was used, past renovations, permits pertaining to the property, insurance claims filed in the past, and legal cases attached to the property among other information. This puts the investors in a better position to decide whether to go ahead with the purchase in a quick manner.
Moreover, Big Data is paramount in risk mitigation to reduce losses.
5. Efficient Running of the Businesses
As mentioned earlier, real estate companies relied on manual processes.
This meant labor-intensive procedures and more man-hours for the work to be done. The entrance of big data brought about process automation. Big Data uses Artificial Intelligence technology to process huge volumes of data faster and accurately to produce user-friendly data.
With the time-consuming manual processes out of the way, real estate agents now have more time on their hands. Moreover, they are using this time to concentrate on more important business functions such as improving customer relationships.
Property developers, on the other hand, are using useful data sets to keep abreast with the market changes and adapt quickly as needed.
Big Data analytics provide real estate stakeholders with access to valuable information drawn from different and numerous sources. This gives a wider scope of data analysis and accurate insights into properties and land.
Such an approach equips real estate business owners with the information they need to make better development decisions. Similarly, agents can zero in on properties that match their customers’ needs faster and buyers can dig out information about properties before making the purchase decision.