Big data has changed the way that a lot of companies do business and real estate is no exception. Since big data is processing a large amounts of data, and used to discover trends in user behaviour, predict future outcomes, or gain valuable insights, it is often referred
as the three Vs’ of big data which stands for volume, velocity and variety.
With that being said, the data provided by real estate service providers can be used to provide insights that would help them better meet their needs of their existing customers. Moreover, the data can help real estate owners to position themselves as the real estate partner of choice for prospective customers. The revolution of data makes finding data on proximity, real-time traffic estimations, noise levels, areas of late night activity, restaurants, parks, outdoor activities and customer reviews easy to find, and eliminates some of the typical buyer confusion which ultimately help with making smarter investment decision. It can also be said that big data is transforming the real estate industry into a well-calculated game of information.
Some of the benefits of big data in real estate sector include:
- Risks reduction
Reduction of financial risks might be important for real estate agents as it is important for them not letting their clients down. Therefore, predictive analytics is crucial to help them mitigating risk as predictive analytics analyses the condition of the property considering all nuances, its age, information about the owner, etc. Given all the capabilities, real estate agents can provide a buyer with detailed information about a house more confidently.
- Simple and fast evaluations
Realtors use property evaluations to set their property prices, and home buyers as well as investors use them to put forward offers. Also, in order to calculate loans and minimise losses, financial institutions rely on them to reduce risk. Therefore, big data has the ability to make appraisals based on years of market data, making it a tool for buyers and sellers alike. Coupled with viewing the property, it offers a way to make accurate appraisals. Besides, big data can help real estate agents quickly find an appropriate building with indicated parameters.
- The improvement in marketing strategy
When real estate agents are monitoring social networks, big data algorithms play a big role in helping them to gather more information about a client more easily and precisely. When they have all the required information, it helps them to contact their client with tempting offer. However, big data does not play role in this process of the actual prices since real estate agents always have all prices that are real for a current period time period.
Due to big data and the advancement of technology, real estate industry and business models of real estate service providers will continue to reshape. Even though big data does not change the fundamental of real estate investing, the required skills, responsibilities as well as risks in the real estate sectors are likely to alter in the future. However, the long-term outlook for the real estate industry in lieu of big data and data analysis is still a positive one, if the industry is able to adjust and utilize the benefits of big data by using tools such as machine learning or AI.