While the real estate sector has not always been quick to adopt technology, the changing nature of the industry is forcing it to re-examine the way business has been traditionally done. The industry is now a lot more open to adopting technologies, such as artificial intelligence (AI), which has the potential to improve many facets of the industry. AI is the ability of a machine to solve problems by learning, over time. It has the potential to replace many routine tasks in the real estate sector.
In the pre-construction stage, AI can be used to ensure that there are no flaws in the construction plan, to avoid frequent changes in plan during the construction process. Data analytics has assumed a lot of importance in real estate. Real estate companies can use AI algorithms, to make sense of vast realms of data and improve areas of business, such as marketing, finance, accounting, etc.
AI-powered ‘chatbots’ on websites, can be used to handle routine queries from customers about properties. Globally, many real estate companies are incorporating ‘chatbots’ into their websites, to engage with customers. This allows companies to save on cost of servicing customers and optimise time spent on answering routine questions.Artificial intelligence can also make buildings smarter and safer. AI-enabled security systems offer automated voice and facial recognition, which can improve the security of homes. AI can identify temperature levels and energy consumption of a building, thereby, helping in saving energy. It can be used to analyse the data of a building, which can go a long way in reducing operational costs and improving efficiency.
Many processes within the real estate development life cycle such as product specification, pricing, smart contracting, procurement, property registration information, project progress, customer profiling, product design, customer preferences, etc., can be processed through the blockchain technology to reveal realistic data, which can be used as business intelligence to drive sustainable operations.
The primary benefit of blockchain is that it can be a direct link from business to service and vice-versa, without any intermediaries, thereby, saving on cost, time and clutter. For instance, procurement of goods and services is always a complicated process for developers, because they do not know whether the price they are paying is the lowest and whether the source they are buying from is reliable. Blockchain technology offers real time transactional data on raw materials. This can help the buyer to choose the right source and the right pricing. The limitation of blockchain technology in real estate, depends on the user’s vision, which essentially means that it can have different implications for different users.Another example of blockchain’s application in the real estate sector, could be in making a central land title database for the entire country, which can store historical land title records. Land records are critical to the property market, as it decides the ownership of property. Land title records in India tend to be fragmented and unclear. Blockchain technology can help buyers, in determining the title of land, ownership details of the land, number of transactions that have happened on the land parcels, land disputes, etc. This information can save time, cost and avoid fraudulent land deals. This will lead to improved transparency and protect buyers.
Blockchain can even enable crowd ownership of property. For instance, a group of people who cannot afford to buy a hotel on an individual basis, can come together through an online process, to buy a part of the hotel, as a share. Let us assume the investors put in money, according to their investment capacity and the hotel is bought in physical form. The hotel could then be given on lease to a company such as Airbnb and the hotel can start generating revenue. This revenue can then be shared among investors as per their investment exposure. Blockchain can make this entire process seamless and eliminate the need for intermediaries.