Valuation of a real estate property is done considering a large number of factors. The key factors used in this process include location, amenities, neighborhood, covered area, number of rooms, accessibility from main areas of the region, brand name and other finer details of the property. The data gathered from all these sources is usually enormous, and hence require a substantial time and effort to get analyzed and evaluated after being collected.
Artificial Intelligence has been there for decades and is disrupting various industries for the better. Real estate market is one of few industries to embrace technology a little later, but now thousands of companies are investing millions in this domain to change the face of real estate industry. Implementation of artificial intelligence in real estate industry, for property valuation, is an attempt to make the process speedy, accurate, more efficient and easier.
Property Valuation Using Satellite Imagery
One of many companies using the power of AI to ease property valuation is GEOPHY. It is a Dutch startup founded in 2014. The organization provides services to give insights of a property using different datasets. One of them is satellite imagery. The data gathered from all these datasets is then analyzed using different AI algorithms. Historically, buyers had to rely on the agents to assign their property values. Agents used comparables to do it and the main problem with this approach was that an agent would do it in a rush so that the deal is finalized quickly, and their commission is handed over.
Now with tools that GEOPHY provide, the big data sets can now be analyzed and used to provide an unbiased and more accurate information and most importantly, more granularity and transparency in property valuation process.
The possibilities of AI are not just limited to property valuation, but also there are tools that can predict property appraisal over certain number of years as well. Thanks to AI, the process of property appraisal that used to be atleast 2 weeks long, can now be done in instantly. Tools provided by GEOPHY get dynamically updated by new market transactions everyday and is accurate up to 5.85% which is twice as accurate as traditional methods used for property appraisals. For example, someone who is into Dubai Marina apartments for sale can not only compare it with other neighborhoods but also see its appraisal in certain years.
API Access To Property Auto Valuation Tool
Imagine being a developer and having control over how property valuation tool could be customized to cater to your own requirements. Well, a Singapore based startup has made it possible. UrbanZoom has recently granted access to the API of its property auto valuation tool and further enhanced possibilities that AI can go up to as far as valuation is concerned. This valuation tool is already being used by the Singaporean government agencies and companies.
Other Benefits Of Using AI In Property Valuation
Apart from satellite imagery and API access, the inclusion of AI into property valuation process serves many other benefits as well. Many companies have developed AI tools that can sieve through a number of parameters and connect potential buyers with the best possible property within their requirements spectrum. For example, Proportunity is another start up that gives a forecast on how the price of the said property is going to fluctuate in few years.
Different AI platforms and tools have facilitated the CRE industry in providing a transparent and accurate picture of all necessary information to its investors and customers. Statistic analysis of how a property is going to give a return on investment (ROI) as well as possible fluctuations in price in a certain area are good parameters for any potential investor to decide if their investment is worth it or not, hence resulting in an improved cost efficiency, more accuracy and quicker overall process of property valuation.