By now it’s clear how mobile technology has disrupted real estate, but it’s already time to prepare for the next tsunami: Blockchain and artificial intelligence. That was the message that Mark Lesswing, chief technology officer for the National Association of REALTORS®, delivered to attendees of the Emerging Business Issues & Technology Forum on Saturday.
Joseph Sullivan, user experience developer for the Center for REALTOR® Technology, moderated Saturday’s session.
Both of these innovations involve data management, but the nature of real estate information has also changed. “It’s not about who owns the data anymore, but what you do with the data in your business” that will be a critical consideration for real estate brokerages in the near future, Lesswing said.
Consider the average transaction: Each is made up of many small pieces of data scattered on multiple servers and housed with multiple entities that manage property details, insurance, financing, and more. These silos of data are slowing down transactions and making them costlier to process.
Blockchain may set a more fluid information trail in motion to keep a transaction moving forward. The technology essentially creates a digital warehouse of all the key property information that can be accessible and viewed in real-time as it moves throughout the real estate process. Therefore, insurance, finance, and real estate professionals could convene on a system to add and exchange information, rather than entering it in multiple places and storing it in their own offices. This could help remove data entry errors, but it can also help protect against fraud since you can easily see whenever the data has been altered.
“By having everyone working from the same thread it could really revolutionize how real estate is transferred,” said Dave Conroy, an engineer for NAR’s Center for REALTOR® Technology Labs. Further, it could potentially move average closings from something like 45 days to just 15, Conroy predicted.
CRT is working to organize efforts to launch an industry-wide blockchain application in real estate. However, it could still be three years until companies start embracing the technology more readily, and a decade before it becomes universal, Conroy predicted.
“This has the potential to be the most impactful technology in the next decade, along with AI,” Conroy said.
Indeed, tech experts view artificial intelligence as another potential game changer on the horizon. Its applicability to real estate stretches beyond just chat-bots calling up information when queried. CRT Labs is also exploring uses of AI in real estate transactions. Machine learning, a subset of AI, could improve lead generation systems by better targeting those who are likely to sell their homes sooner than others, or providing a better syntax for searching property photos by cataloguing objects contained in those photos, said Aleksandar Velkoski, NAR data scientist.
A combination of virtual reality and AI could pave the way for viewing a property in real-time under different remodeling scenarios. Further, Velkoski pointed to “augmented discovery” in using AI to help crunch big data into more user-friendly, readable formats much faster than a human could process. For example, AI could be used to identify transaction patterns and make predictions from it, like who might be gearing up to sell their home soon.
“There are certain things that machine learning can do much faster than a human could ever do,” Velkoski said. “The future of the real estate industry is AI and employing AI-driven systems so that we can do more. Let the machines do what they do well so we can focus on more value-driven opportunities for our customers.”