“You won’t lose your job to AI, but you will lose it someone who’s better at using it than you.”

With hundreds onsite at IMN's AI in Real Estate forum, the day was dedicated to exploring what to know, understand, and anticipate about AI's increasing integration into the real estate market.

Real estate has been one of the slower markets to adopt AI, with ever growing fragmented pools of disconnected data. But it seems that is now changing, with delegate sentiment being of the “use or lose” mindset.

Back to basics quickly –

What is AI?

AI is computer/machine technology that generates human intelligence and problem-solving abilities.

What about generative AI?

Gen AI, is a form of machine learning that teaches technology to process information as a human brain would. Using patterns and relationships found in the data, new content is then generated.

Let’s begin...

How does AI effect the resident experience?

Well apparently, time is no longer of the essence. Chat bots are a game changer, and a time saver. Bots answer the mundane – frequent – questions that used to take up all the time of a leasing agent. In turn, the leasing agent now has time to deal with higher level responsibilities and devote extra attention to new layers of improving residential wellbeing. With response rate deemed by one panelist as “the biggest contributor of resident retention”, so too would employee retention be aided by passing the less stimulating tasks.

Additionally, pre-covid, it was an in-person tour, or the highway. Post-covid, “90% of people would prefer a virtual tour.” Virtual reality has become the reality. That said, personalized mass emailing is enabling residents to connect with their neighbors and community in a way they’ve not been able to before, with online connections facilitating offline interactions.

One panelist outright said “AI is really increasing the tenant experience overall” with their example being “friendly automated text reminders that rent payment is coming up in 5 days, 3 days etc.” “Most importantly, what we’re trying to achieve with AI is how we can understand, not only the language, but the culture, and how the person is willing to communicate better with AI.”

How else is it helping:

• Keep it real: Analyzing real time data to then inform real time decisions i.e. automated emails > leads > conversions > demographic/market engagement heat maps
• Monitoring/chasing rent payments in a reciprocal manner
• Early indicators of tenancy renewal enabling time to identify gaps and increase these rates
• Avoiding evictions and attracting the right people with higher level credit card checks
• Rise of SMART technology: i.e. AI monitors batteries low in smoke alarms
• AI insights giving suggestions based on Heating, Ventilation and Air Conditioning (HVAC), lighting use, therefore identifying ways to conserve energy

A Solution, A Problem

However, with growing mounds of data comes the issue of keeping it safe. It was reiterated that paying to “safeguard” your data is the best investment you can make. And, if you don’t, “you’ll end up paying for it later on.”

No, you didn’t hallucinate, that’s correct. Speaking of hallucinations, AI is capable of just this and can offer incorrect answers to your customers. It was advised to “train your AI as you would train a human.” Just like a human, AI can make mistakes and it’s your responsibility to take care when setting up this framework and monitor the output on an ongoing basis. If that seems overwhelming, the conference was packed full of vendors who know what they’re doing - and can help you - with one speaker advising: “generate partnerships, generate co-collaboration so you can do better.”

Be careful of the smoke and mirrors

“Just like social media, it’s getting to the point where there’s so much data out there you don’t know what’s real.” Be careful of misinformation and where you are recycling your data from. You need to be able to see the wood for the trees.

Know your audience; senior aged people are less familiar with technology and there were multiple recounts from panelists that their automated systems has been spamming – and overwhelming – older people. This was worsened by the fact that real life agents were also messaging; the tech system and human system were not in sync. Don’t be so connected that the customer gets disconnected.

“The Wild West” and Regulation Road

With the AI landscape referred to as “the wild west” multiple times, guidance included protecting yourself where possible. Countries and regulatory bodies themselves are getting to grips with this space but later down the line – following an inevitable even wilder west – governments, privacy laws, etc. will step in – don’t be too far gone with how you’ve used this tool. “AI isn’t a magic wand that will solve all your problems” – avoid complacency, monitor the output, and get the right people in to help.

 

Friend or foe to the employee?

The sentiment on the day was more friend than foe as AI is here to pick up the “less intuitive” tasks, such as responding to customer questions, or writing a memo. An onsite lightbulb moment included “imagine our top three people now have time to focus on xyz”, instead of always being overwhelmed with AI’s new job. Employees will be able to put the “pro” in proactive, with extra bandwidth to hone new skills, rather than operating in the “reactive” zone. “We won’t be replacing employees, we’ll just have better operational facilities.”

Should I give up or should I just keep chasing payments?

AI upskilled and so to must humans. It was remarked that what was previously entry level i.e. scanning documents, chasing payments, will no longer be the entry level job in the workforce as AI and automation will be doing this. In turn, the entry level job for Gen Zs, and the wider talent pool, will be of a higher level, elevating the professional playing field. “This workforce is going to evolve and the market will change eventually.”

 

The Crystal Ball

A real buzz for AI was the use of predictive analysis. “We’re in the 1960s of AI right now” so predictive modeling will continue to get smarter. However, the opportunities shared included “where will lead conversions be at this time?” to “should I work with this company, where will their balance sheet be in 30 days, or 30 years?” The comfort of knowing a likely outcome – or even just what to avoid – might help investor buy-in, but when sharing predictive insights it was noted that onboarding should include what data is the client happy to share i.e. third party information, legalities etc. Similarly, what data is the predictive forecasting based on in the first place? If you get that part wrong, get ready for some blurry insights.

 

Any (A)dv(I)ce?

"Start small. Begin with a small scale project where you are in the safety parameters of testing and learning. One case study included the 'flip finder bot', which flattened their learning curve.

“Chat GPT will release a new version and the old one will be “obsolete” so “make sure you’re investing in the big AI platforms.”

When founders were asked why they created their company, one answer was “time: time, optimizing it and responding to your resident makes the biggest difference to resident experience."

“Educate your robot - and we have to educate ourselves about using the robots”

“Have the right tools to make a decision and not have owners and asset managers like us get in the way.”

“Technology evolves, the world evolves, and we want a better product at a lower price with a better experience.”

“As a leader, it’s important – even if you don’t understand what AI is – to bring in someone who does and make efficient changes that’s empowering to all.”

 

One panelist said, "people want the efficiency of AI with the touch of the human eye". A-EYE, it seems, is the middle ground that will bridge real estates' sea of asset classes, with this AI wave that will only continue to gather speed and wash over the industry.

Applications referenced:

• Ren
• Chat GPT
• Gemini
• Elise AI

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The conversation continues soon: Register for the 6th Annual Single Family Rental Property Management, Operations, and AI Forum on Aug 22-23, 2024, Austin, TX