The real estate industry is now at a turning point, as the latest technologies such as AI, IoT, and Big Data are rapidly developing and rewriting conventional wisdom and practices one after another.
I have always placed "human resources" and "trust" at the core of my management, and have worked hard to build relationships of trust with each and every one of our clients. However, the evolution of technology is drastically changing the way we work. We see this wave of change not as something to be feared, but rather as a great opportunity to renew the industry as a whole and provide better services.
In this paper, we would like to discuss the state of real estate brokerage in the age of AI, with an analysis of the current situation and a vision for the future.
The Current State of Real Estate Tech
Real estate tech (PropTech) is a new approach to solving issues and improving efficiency in the real estate industry by utilizing the latest technologies such as AI, IoT, and Big Data. The Japanese real estate industry has long been dominated by analog business processes, but in recent years the wave of digitization is spreading rapidly.
In particular, the recent development of generative AI technology has led to revolutionary changes in various aspects of the real estate industry, including data analysis, customer service, and property introduction. It is predicted that "many processes in the real estate industry will be automated and advanced by generative AI in the next 5 to 10 years," and the value created is estimated to be in the range of $110 to $180 billion.
Specific examples of applications include the following
1. property matching and recommendation systems
AI can instantly match a vast amount of property data with customer requirements and suggest the most suitable properties. The latest AI matching systems can now automatically generate property listings optimized for individual clients simply by answering questions such as budget and preferences.
2. price assessment and market analysis
The AI-based real estate price prediction model learns from past transaction data and surrounding environmental information to enable highly accurate assessments. Some systems are now capable of predicting rents with a high accuracy rate of only 4.98% error rate, greatly improving the transparency and accuracy of pricing.
3. virtual preview technology
Property viewing services that utilize virtual reality (VR) and augmented reality (AR) technology have made it possible to preview properties regardless of time or location. Prospective tenants can reduce the number of on-site previews and view every inch of the property on a virtual room tour.
4. automation of customer service
With the introduction of AI chatbots, we are now able to respond to customer inquiries 24 hours a day, 7 days a week. From answering simple questions to providing property information, automated responses are now possible, improving both customer satisfaction and operational efficiency.
The Role of Real Estate Brokerage in the AI Era
These technological advancements are changing the nature of the real estate brokerage business. However, technology alone cannot completely replace human sensitivity and experience-based judgment. Rather, I believe that AI and humans can provide unprecedented value by working together, leveraging their respective strengths.
Fusion of Technology and Human Capabilities
AI has unparalleled capabilities in processing, analyzing, and streamlining vast amounts of data. On the other hand, only humans can provide the "feel" and "comfort" of choosing a property, as well as emotional support in making important life decisions.
For example, the U.S. real estate tech company Compass has developed a proprietary AI platform that combines data analysis with human expertise to provide a customer experience that, in addition to AI market analysis and property recommendations, also includes agents who take care of the emotional side of the customer and provide valuable advice.
At INA&Associates, while we are proactively adopting the latest technologies, we also value direct interaction with our clients and building trust above all else, believing that AI is only a tool, and that the final decision and value should be made by humans.
The New Role of Real Estate Professionals
What role should real estate brokers play in the age of AI? I believe the following points will be important
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Role as interpreter and translator of data
They will need to be able to translate the vast amount of data and analysis provided by AI into meaningful insights for their clients. It is important to convey value and potential as an expert that cannot be conveyed by numbers alone. -
Providing Emotional Support
Finding a home and investing in real estate are important life decisions. Only humans can provide emotional support, not only in terms of numerical rationality, but also in terms of psychological reassurance and expectations for the future. -
The Bearer of Ethical Decisions
AI algorithms can contain bias. Humans are also required to monitor and adjust AI proposals from a fair and ethical perspective. -
Creative Problem Solvers.
The ability to propose creative solutions to special conditions and complex requests, rather than standard cases, is the strength of humans with their experience and flexibility.
Future Real Estate Brokerage Business Model
So what will the real estate brokerage of the future look like, where AI and humans coexist? Below, I would like to describe my vision of the future business model.
Hybrid service model
A hybrid service model combining basic information provision by AI, property matching, and high value-added consulting by humans will become the mainstream. Customers will be able to utilize AI systems at their own pace while receiving expert advice in critical decision-making situations.
2. data-driven and human-centric value delivery
While based on the vast amount of data collected and analyzed by AI, the final value provision will be based on a human-centric approach. For example, personalized advice tailored to the customer's life plans and values can be provided based on the results of data analysis, such as forecasts of the future value of the property and changes in the surrounding environment.
3. building a community-based ecosystem
In addition to real estate transactions, AI will accelerate the construction of a comprehensive ecosystem that connects various services related to housing and living. A world in which all services related to housing, including mortgage, moving, remodeling, energy management, and community building, will be seamlessly linked will be realized.
In the midst of this transformation, real estate brokers will need to evolve from mere "property introducers" to "total lifestyle coordinators.
INA&Associates' Approach and Prospects
We at INA&Associates aim to be "the world's No.1 human capital investment company" and are working to create new value through the fusion of technology and human resources.
Human Capital Development and Technology Education
We are committed to training the next generation of real estate professionals who can respond to the evolution of AI and technology. Developing human resources that combine data analysis skills with human empathy is a source of competitiveness in the age of AI.
Enhancing Transparency and Trust
To build trust, the most important factor in real estate transactions, we are working on a highly transparent AI-based price assessment system and visualization of the transaction process. Through these efforts, we are eliminating the asymmetry and opaqueness of information in the traditional real estate industry and creating an environment in which customers can feel more secure in their transactions.
Finally: The spirit required in the age of AI
Although technology is constantly evolving, the essence of the real estate brokerage business is to "connect people with people and provide them with the optimal home," and it is important to maintain a balance between the "traditional" aspects that will not change in the AI age and the "trendy" aspects that will change in step with technology. AI and technology are not the same as human beings.
AI and technology are tools to expand human potential, but it is people themselves who ultimately create value. This is the way forward for real estate brokerage in the age of AI, valuing "human resources" and "trust" while maximizing the power of technology.
We at INA & Associates will continue to pursue a new way of real estate brokerage by fusing technology and human power, so that we can continue to be a partner that brings value to the lives of each and every one of our clients. As a company involved in the important life choice of "home", we will pioneer the future of real estate brokerage in the age of AI, with responsibility and pride in our work.
