This is How PropTech Companies are Using AI
AI, or artificial intelligence, is changing the world as we know it, and the real estate industry is no exception. Redfin recently launched a ChatGPT plug-in to help people find their next home. So did Zillow, and it’s likely that other major real estate sites will make similar announcements in the near future. How are these and other major property tech companies utilizing AI at the dawn of this new tech age?
Currently, the Zillow ChatGPT plug-in is in its first phase of software testing. It’s being offered to a select number of ChatGPT users, with wider access eventually available. The Redfin plug-in is available to “eligible” ChatGPT users, and if that’s not you, join the company’s waiting list.
Zillow started using AI back in 2006, with the introduction of its Zestimate, according to David Beitel, the Zillow Group’s Chief Technology Officer. Later, it introduced personalized recommendations and natural language searches. Generative AI, such as ChatGPT, is the next logical step.
Searches will become more personalized.
What’s Different about the ChatGPT Plug-in?
Right now, you can enter the type of home you seek directly into the realtor platform. In its current form, the ChatGPT plug-in doesn’t appear much more advanced. It’s likely that if you want a four-bedroom home on at least an acre with a swimming pool in a specific location, what emerges from the Redfin or Zillow platform is probably similar to what ChatGPT reveals. After all, ChatGPT is getting its information from the platform’s database.
According to a Zillow press release, by using “conversational language,” users can delve more deeply into particular listings or “ask about property listings based on details, like location, price range, and bedroom, and bathroom count.”
Redfin’s plug-in allows users to provide annual income information along with the type of house, neighborhood, and amenities they’re looking for and to receive affordable listings that fill the bill. The user can then book a tour with a licensed Redfin agent.
What AI can now deliver to consumers are more realistic, immersive 3-D tours. Searches will become more personalized. If someone wants a travertine floor in the kitchen or has their heart set on a house by a lake, ChatGPT can find available offerings fast.
Along with content creation, AI enables content discovery.
Floor Plans and More
Zillow products now include AI-generated immersive floor plans. These plans give agents, appraisers, and property managers the ability to measure the home virtually. They can then share this layout with prospective purchasers.
Realtor.com features the AI-powered Dream Home experience. Just type in a prompt describing your ideal dwelling, and the AI creates an image based on your input. It also searches all of the listings on Realtor.com to come up with homes resembling your vision. Along with content creation, AI enables content discovery.
As its SVP Brand & Executive Creative Director, Nuno Ferreira states in a press release, “At its core, Realtor.com is a technology company that serves the real estate industry, and that’s why we’re excited to use tech, like AI, to power the home search.”
Want to win the floorplans for that AI-derived dream home? Realtor.com is sponsoring an AI Dream Home Sweepstakes, which started April 17, 2023, and ends “when the sponsor halts the image generation functionality on the sweepstakes landing page.” One lucky winner receives a blueprint suitable for framing provided by Toll Brothers Inc., along with $2,500 in cash. There’s a caveat: The blueprint is not intended to be complete as an actual home and cannot be relied upon for any building project.
AI can remove the human bias that accompanies even the best property appraisers.
More Accurate Home Valuation
While the average person looking for a new home may not see much difference in the way the realtor’s platform and ChatGPT operate right now, real estate professionals are using AI in ways that may create a more robust industry.
For instance, AI can provide instantaneous real-time home valuations. Did you redo your kitchen? Simply upload the photos and receive a quick reevaluation of your dwelling’s worth.
On a larger scale, AI will transform the property appraisal process. Realtors will not have to rely on just a few comps for value determination. In any given period, accessing completely objective comps on any property sold is easy. The value of every item, such as a fireplace, is valued specifically for any home based on data, such as location, size, and age of the building.
If a property’s appraisal is not in line with similar homes, AI can objectively identify those reasons. AI can remove the human bias that accompanies even the best property appraisers. Investors can determine whether to purchase properties based on what AI foresees as their future worth based on market trends and past transactions. Whether an investment is worthwhile based on AI’s predictive analytics may become the deciding factor. ChatGPT also generates real-time, in-depth market updates.
The problem is that AI still has some hiccups, which can cause it to give out false information.
Greater Advantages for Established Companies
It’s not surprising that AI is likely to benefit large, established companies rather than startups. AI needs tons of data for training purposes, and big companies possess huge amounts of data along with customer relationships.
That doesn’t mean startups can’t use AI to their advantage. After all, AI is virtually turnkey, with any sized company able to enlist AI bots.
The problem is that AI still has some hiccups, which can cause it to give out false information. While Open AI, the creator of ChatGPT, has designed safeguards to minimize inaccuracies, the technology still may produce errors. A serious error will likely affect a startup more severely than a major player.
The potential for AI is seemingly endless, but much will depend on how major real estate firms incorporate this tech into their strategies.
Will AI Live Up to the Hype?
AI is certainly not new to the real estate industry, but it got better much faster than previously thought possible. However, there’s no shortage of products or technologies in which reality did not live up to the hype, like digital currency, touted as the next big thing just a few years ago. While the number of homes bought with cryptocurrency is rising steadily, the overall percentage remains small.
Any type of AI feature is now promoted zealously, even if its effect is not that new or especially useful. There is no question that AI is a great tool for writing property descriptions, generating leads and ideas, scheduling property viewings, and providing property recommendations. The potential for AI is seemingly endless, but much will depend on how major real estate firms incorporate this tech into their strategies. Right now, big players, like Redfin and Zillow, are taking the initial steps in ChatGPT launchings for the general homebuying public. The results will impact how the industry uses AI going forward.
In a world increasingly impacted by AI, it’s important to note that this article was written by a real human being.