Real-Estate Agents Look To AI For Sales Boost
American technology leaders at Realogy, Compass and Zillow hope to augment human savvy with algorithms.
3 min
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Information-technology executives at some real-estate firms are rolling out artificial-intelligence-based tools designed in part to help agents close deals faster, which could prove useful in today’s hot housing market.
While the selling and buying of homes remains an agent-driven business, IT leaders say such tools can augment their efforts, especially in a market with record prices and tight inventory.
“AI can play a significant role in simplifying and automating processes where traditionally humans have been involved,” said Rizwan Akhtar, chief technology officer of business technology at Realogy Holdings Corp., which owns brokerage brands including Coldwell Banker, Corcoran and Sotheby’s International Realty.
Artificial-intelligence efforts in the real-estate sector are benefiting from advances in cloud computing and data analytics, as well as improvements to algorithms, according to technology leaders at Realogy, Compass Inc. and Zillow Group Inc.
Realogy uses more than 25 AI models, Mr. Akhtar said, including models that can help agents predict their chances of converting a prospective client into a paying client and others that can predict the optimal percentage split between a broker and an agent on a property.
The company is in the early stages of testing an AI app that aims to predict when certain milestones will be reached in the home-buying process, he said.
At real-estate brokerage Compass, an AI-based tool that predicts whether people in an agent’s contact database are likely to sell their homes within a year resulted in more “listing wins” for its agents, said Joseph Sirosh, the company’s chief technology officer. In the second half of 2020, the tool’s recommendations led to a 94% higher “win rate” than the rate for properties that weren’t identified as likely to sell, he said. The technology was released last summer.
Agents reach out directly to people identified by the tool as likely to sell. Traditionally, agents knock on doors, rely on word-of-mouth referrals and make calls to meet potential clients, Mr. Sirosh said. “Agents save time when they are far more targeted,” he said. The model takes into account dozens of variables to make a prediction, including how often homes sell in that region, what the last sale price was and how much the home has appreciated over time, he said.
Realogy offers agents a similar tool.
The coronavirus pandemic resulted in boosting adoption of AI tools among agents, Mr. Sirosh said. During the height of the pandemic, “agents could not work without technology which meant that everything associated with technology, like AI, which provides efficiencies, became incredibly useful,” he said.
Online real-estate company Zillow recently announced that its Zestimate tool, which estimates a home’s market value, is powered by a neural network that learns on its own and takes into account hundreds of millions of data points. The data range from the home’s square footage and unique features to location and how the property differs from surrounding homes, said Stan Humphries, the company’s chief analytics officer.
A neural network is a branch of artificial intelligence that aims to mimic the way the human brain learns.
AI-based models can’t account for human intuition or empathy, though. Buying and selling a home is a “deeply emotional, very risky transaction,” Mr. Humphries said. “Humans are always going to want another person, an expert, to help them with that process.”
AI can add value for agents in incremental ways but real estate will always be a heavily people-focused industry, said Mike DelPrete, scholar in residence on real estate technology at the University of Colorado Boulder. Real-estate companies sometimes tout their prowess in technology and AI to attract agents, Mr. DelPrete said. But the degree to which agents will actually adopt AI and other software tools is uncertain, he added.
“More people are talking about AI in the real-estate industry as a point of differentiation…but the reality on the ground is that it’s more of a marketing tagline,” Mr. DelPrete said.
Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: June 22, 2021
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You’ll never guess where they found a little extra room when renovating this west coast house
4 min
There was a time, not too long ago, when the most important must-have for would-be renovators was space. It was all about space to be together and space to be apart.
But as house prices increase across the country, the conversation has started to shift from size for the sake of it towards more flexible, well-designed spaces better suited to contemporary living.
For the owners of this 1920s weatherboard workers’ cottage in Fremantle, the emphasis was less on having an abundance of room and more about creating cohesive environments that could still maintain their own distinct moods. Key to achieving this was manipulating the floorplan in such a way that it could draw in light, giving the impression at least of a larger footprint.
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Positioned on a site that fell three metres from street level, the humble four-room residence had been added to over the years. First order of business for local architect Philip Stejskal was to strip the house back to its original state.
“In this case, they were not quality additions,” Stejskal says. “Sometimes it is important to make sure later additions are not lean-tos.”
The decision to demolish was not taken lightly.
“Sometimes they can be as historically significant as the original building and need to be considered — I wouldn’t want people to demolish our addition in 50 years’ time.”
Northern light hits the site diagonally, so the design solution was to open up the side of the house via a spacious courtyard to maximise opportunities to draw natural light in. However, this had a knock-on effect.
“We had to make space in the middle of the site to get light in,” Stejskal says. “That was one of the first moves, but that created another issue because we would be looking onto the back of the neighbouring building at less appealing things, like their aircon unit.”
To draw attention away from the undesirable view, Stejskal designed a modern-day ‘folly’.
“It’s a chimney and lookout and it was created to give us something nice to look at in the living space and in the kitchen,” Stejskal says.
“With a growing family, the idea was to create a space where people could find a bit of solitude. It does have views to the wider locality but you can also see the port and you can connect to the street as well.”
A garden tap has also been installed to allow for a herb garden at the top of the steps.
“That’s the plan anyway,” he says.
Conjuring up space has been at the core of this project, from the basement-style garaging to the use of the central courtyard to create a pavilion-like addition.
The original cottage now consists of two bedrooms, with a central hallway leading onto a spacious reception and living area. Here, the large kitchen and dining spaces wrap around the courtyard, offering easy access to outdoor spaces via large sliding doors.
Moments of solitude and privacy have been secreted throughout the floorplan, with clever placement of built-in window seats and the crow’s nest lookout on the roof, ideal for morning coffee and sunset drinks.
The house has three bedrooms, including a spacious master suite with walk-in robe and ensuite overlooking the back garden. Adjustable blades on the bedroom windows allow for the control of light, as well as privacy. Although the house was designed pre COVID, it offers the sensibility so many sought through that time — sanctuary, comfort and retreat.
“When the clients came to us, they wanted a house that was flexible enough to cater for the unknown and changes in the family into the future,” Stejskal says. “We gave the owners a series of spaces and a certain variety or moods, regardless of the occasion. We wanted it to be a space that would support that.”
Mood has also been manipulated through the choice of materials. Stejskal has used common materials such as timber and brick, but in unexpected ways to create spaces that are at once sumptuous but also in keeping with the origins of the existing building.
Externally, the brickwork has been finished in beaded pointing, a style of bricklaying that has a softening effect on the varied colours of bricks. For the flooring, crazy paving in the courtyard contrasts with the controlled lines of tiles laid in a stack bond pattern. Close attention has also been paid to the use of veneer on select joinery in the house, championing the beauty of Australian timbers with a lustrous finish.
“The joinery is finished in spotted gum veneer that has been rotary cut,” says Stejskal. “It is peeled off the log like you peel an apple to give you this different grain.”
Even the laundry has been carefully considered.
“The laundry is like a zen space with bare stone,” he says. “We wanted these different moods and the landscape of rooms. We wanted to create a rich tapestry in this house.”
The owners now each experience the house differently, highlighting separate aspects of the building as their favourite parts. It’s quite an achievement when the site is not enormous. Maybe it’s not size that matters so much after all.
A “starchitect” name adds to a building’s allure—and how much an apartment may sell for.
