Real Estate Agents and Artificial Intelligence
With the advent of technological expansion in our society, leaving more and more livelihoods risk of being replaced by AI, will the existence of real estate agents be nullified? Historically, the job title of a real estate agent comes with a subtle impression of rudeness, mistrust and caution, having countless cases of fraud affecting thousands throughout the world, from expat forums warning of potential scams to headline news detailing the latest schemes not to fall for. These cases appear in news sites internationally ranging from protest and vandals on Foxton offices in Brixton to the countless cases of conmen posing as property agents in Malaysia despite various measures taken.
Although, these events are quite uncommon, it only takes a few bad apples in the bunch to ruin the whole industry for the rest, giving honest agents a hard time and a bad reputation. Knowing of such cases while having the real estate agent being a gatekeeper to their dream home, it won’t be surprising that many people be skeptical and would opt in for a robot to do the work.
A recent study by the accountancy firm Moore Stephens found that one fifth of UK estate agents are potentially of out business with expansions of online property agents who operates on lower fixed cost. These agents have the added benefit of allowing home buyers to view offers online complemented with fast replies using instant messaging. On a larger scale, startups and artificial intelligence are constantly changing the playing field, revolutionizing industries, shifting the economy to another level. What used to be a simple way of buying food and goods at a grocery store has become much simpler thanks to AI.
The consumer goods sector perfectly depicts this trend. E-commerce giants like Amazon and Ali baba has cut down distributors and retailers, allowing goods to be ordered from the warehouse cheaply with fast deliveries while network marketing companies like Amway and Cosway completely creates a whole new purchasing channel that diverts from conventional means. Luxurious cruise trips and used to be expensive international trips are now available to the mass majority with the many travel portals offering the cheapest deals. With such changes to so many industries, will real estate soon experience its own disruption? And how will real estate agents be affected in the storm?
The nature of Real Estate
As a disrupter in the real estate space that deals with agents, we at Bumbung.co believe agents have a key role and a future in the industry. Unlike the enormous supply and homogeneous nature of retail goods and services, real estate is heterogeneous in nature. No two homes are the same, a corner home with similar architecture designs located in different lots can fetch up to drastically different prices and a dilapidated home in a high profile neighborhood can be in high demand. This means that a home is bought as a lifetime good and is filled with sentimental value. This brings a the homeowner’s experience to a whole new level, one that cannot be truly experienced regardless of the endless variety of VR devices on the market or the many pictures and beautifully designed brochures.
Does the house have good ‘feng shui’? Is it suitable for disabled individuals or the elderly? Will the highway nearby distrupt your beauty sleep? Or it could be elements only experienced with a physical presence that would influence a buyers decision like the ambiance of the rooms, the size of the bathroom or the temperature of the rooms during the day. Other factors include sentimental values which is up to the real estate agent to help the buyer visualize and provide suggestions. Remember that a home purchase is permanent and long-term, requiring lots of contemplating before the ultimate decision.
It was found that Real estate agents should always play a key role in the home buying experience and that computer algorithms work better when working with real estate agents than those without. Bridget Frey, the chef technological officer at Redfin during Seattle Startup week regarding AI and agents. Moreover, AI instead has further enhanced the workflow of agents by automating some of the boring task while providing valuable data for them to utilize with their clients.
In the long run, increasing competitiveness delivered by technology and its growing accessibility to agents, there would undoubtedly be fewer but more highly skilled agents. Less people will be needed for mundane, easy task while more quality work will be done. The agents who will thrive will be those who can leverage their interpersonal skills and create positive emotional experiences for home buyers.
In a near future, AI may be able to fulfill tasks more efficiently than any human can however, our mortal traits still make us relatable to each other. Until artificial intelligence can accurately replicate and discern emotional cues, there will never be a substitute to being human.
Do you think that AI will replace real estate agents? Share your opinions in the comments below.