The notion of predictive analytics has been invading all industries and businesses around the globe.
It’s only natural that it’s found its way in a multi-trillion dollar industry like real estate as well. But what exactly are the ways in which agents can use predictive analytics in 2020?
In 2020 there will be many different ways in which a real estate agent can use predictive analytics: from lead generation and property generation, through lead nurturing and property analysis, to buyer-to-seller matching and closing deals. The simple answer to this question is: Predictive analytics allow agents to do more real estate business in less time.
To help agents and brokers expand their business in 2020 by closing deals more efficiently, we will have a detailed look at how they can use predictive analytics in real estate. Here is an outline of this article:
- What Is
- How Is
Predictive Analytics Applied in Real Estate?
- What Are the
Uses of Predictive Analytics for Real Estate Agents?
- What Are the
Benefits of Using Predictive Analytics as a Real Estate Agent?
- What Should
Agents Keep in Mind When Using Predictive Analytics in Their Real Estate
Let’s dive in!
1. What Is Predictive Analytics?
Predictive analytics is a new concept which gives an answer to the
old question of “How to predict the future.” Before you start feeling
like a wizard, let us clarify that in this case predicting the future is not
based on some whimsical assumptions an wishful thinking but constitutes a
reliable, data-driven approach. As such, the predictive analytics definition
implies using past and present big data to make reliable, evidence-based
predictions and forecasts about future outcomes.
When applied to the real estate industry, AI and machine learning have allowed predictive analytics to build on traditional real estate analytics. Traditional analytics show agents and investors how and why we stand where we stand today through big data analysis. Predictive analytics tools take this analysis to the next level to predict future outcomes based on how past and present events took place.
2. How Is Predictive Analytics Applied in Real Estate?
While the real estate business has not been disrupted to the same extent
as other industries such as finance, insurance, health care, and education, AI
is slowly but surely revolutionizing the real estate industry. The introduction
of predictive analytics software tools is one of the ways in which this is
analytics real estate platforms can be used in different ways by all main stakeholders
in the industry:
Analytics for Real Estate Agents
In brief, agents can use AI and machine learning models to optimize
all aspects of their day-to-day activities. These include but are not limited
to: lead generation, lead qualification, lead nurturing, real estate marketing,
property generation, property analysis, property
valuation, and buyers-to-properties matching. This issue will be discussed
in more details in the following section.
Analytics for Real Estate Investors
Real estate predictive analytics have revolutionized the way in which investors search for and find profitable investment properties. Mashvisor is a pioneer in this regard. As one of the prominent predictive analytics examples in real estate, the Property Finder on our platform uses machine learning based predictive algorithms to find the most suitable rental property among hundreds of real estate listings in any real estate market. To do that, real estate investors need to just enter a few basic parameters such as their budget, financing method, property type, and housing market preferences. Our advanced real estate technology considers their social and financial background to bring to them the investment properties which they are most likely to buy.
Analytics for Lenders
The nature of financing rental properties and homes has also been
revolutionized by 21st century technology. Predictive analytics in
real estate provide banks and other lending institutions with all the data and
analysis they need to improve the way in which they lend money to homebuyers and
real estate investors.
Analytics for Property Insurers
Home insurance is another part of the real estate industry which has been swept by the introduction of predictive analytics. Property insurers now know exactly how much they need to charge each and every property owner based on big data.
3. What Are the Uses of Predictive Analytics for Real Estate Agents?
Now we’ve come to the core of this article: how to use predictive analytics in your real estate business as an agent. There are many uses which the power to predict future outcomes and probabilities has found in the daily routine of a real estate agent. Here are the most significant aspects of the real estate business which have been permeated by this new technology:
- Lead Generation
Being able to generate buyer leads and seller leads is key to the success of a real estate agent and his/her company. Traditionally agents had to market themselves all the time so that property buyers and property sellers come to them when they need them. With the emergence of real estate technology based on big data and AI, this is no longer the case. The last couple of years have witnessed an influx of predictive analytics solution platforms which drive leads to real estate agents with virtually zero efforts on the part of agents. What these predictive analytics tools do is get big data including demographical, social, financial, and other types of information and apply complex analytical models and machine learning algorithms to come up with patterns which predict – with a very high degree of probability and very small margin of error – which homeowners are most likely to sell their home soon. In simple words, predictive analytics software has the power to predict intent – the intent of your potential real estate clients to sell.
This is the dream of every real estate agent coming true as it
virtually means effort-free lead generation. This data-driven approach not only
helps agents generate seller leads but also shows them how
to get more listings in real estate. In this way
predictive analytics also takes care of the property generation aspect of the
estate lead generation is crucially important for agents
and brokers, their work does not end there. Once a real estate agent has leads,
he/she has to decide which leads are worth focusing on and which leads would be
a waste of time and energy. That’s where lead qualification comes into
play. This aspect of the business has also been revolutionized by the emergence
of predictive analytics for real estate agents. Let’s see how.
First of all, with regards to seller leads, the real
estate leads generated through predictive analytics real estate platforms are
expected to have a very high probability of actually selling, so the lead
qualification aspect has been more or less been taken care of.
But how about buyer leads? Do real estate agents still need to sit
for hours with potential property buyers and ask them a ton of questions in
order to figure out how likely they are to buy in the next couple of months? The
answer is: No, absolutely not. Real
estate predictive analytics software, such as Mashvisor, has
developed an easy, straightforward solution to this ancient challenge in the
industry. With the help of our user-friendly Mashboard, which
uses big data and real estate analytics, a real estate agent can quickly and
accurately qualify leads. This takes the guessing out of the lead
qualification game in addition to making the process much faster and more
efficient. Predictive analytics for real estate agents empowered them to stop
wasting time on leads who won’t buy and focus on those who are (nearly)
guaranteed to move forward with a property purchase in the next few weeks.
- Lead Nurturing
Having all the most qualified leads in the world will do nothing
for your real estate business unless you are able to convert them into
customers. The way that a real estate agent nurtures leads has also been
disrupted in the 21st century. Agents don’t need to waste the
majority of their time and efforts on generating leads at the top of the sales
tunnel but can focus on nurturing their qualified leads, building long-term
relations with them, and finding the best real estate property for sale for
each one of them.
As every real
estate marketing expert knows, the main components of a results-oriented real
estate lead nurturing strategy include segmenting your audience and adding
value – real value – to their experience. That’s the only way to make
yourself stand out from all the other real estate agents out there.
As you can imagine, predictive analytics marketing in now a
thing in the real estate industry, and it constitutes a crucially important
tool for any agent who wants to grow his/her business in 2020. There are
numerous marketing platforms with a predictive analytics tool which helps
agents develop and send out customized emails, SMSs, and social
media posts, based on the interests, behavior, and expectations of each
lead segment. Digital
marketing automation is a must for any agent who wants to stay competitive
in the 21st century.
The Mashboard can help out in this regard as well. This advanced real estate technology tool allows real estate agents to download comprehensive property analysis reports which include all the real estate data that property buyers would like to have and send them to their buyer leads. Meanwhile, all communication across multiple clients will be tracked.
But before sending this investment
property analysis report to a potential client, a real estate agent needs to figure
out the best property for this particular lead.
Matching a property buyer with the best home for sale in
the local housing market is one of the most important elements of the lead
nurturing process. No matter how much high tech you use, you can’t sell to
someone unless you have the right property which meets all his/her requirements
and expectations such as budget, location, number of bedrooms, and others.
There is another Mashvisor predictive analytics software tool which
helps agents present their leads with the perfect property based on all these
criteria and many more – the Property Recommender. While this tool has
been developed with the needs of real estate investors in mind, it could be
applied to home buyers as well. The Property Recommender’s algorithm uses
advanced real estate data for your client as well as for other real estate
investors with a similar background in addition to investment property analysis
of the hundreds of thousands of homes
for sale listed on Mashvisor (including MLS listings, foreclosures,
market properties as well as any other property listings which you might have) to
find the best rental property for your lead. While this takes only a few
seconds, the results are 90%+ accurate.
Once a real estate agent has pulled the right property with the help of our machine learning algorithms, he/she can reach out to his/her clients with the comprehensive, customized investment property analysis reports which we mentioned before as part of a predictive marketing strategy.
4. What Are the Benefits of Using Predictive Analytics as a Real Estate Agent?
You have probably already took note of some of the most important advantages of using predictive analytics for real estate agents. To assure you’ve not missed any of them, here is a summary of the main ways in which applying AI and machine learning algorithms to your real estate business will help you:
- Improving the quality of buyer leads and seller leads
- Generating more houses for sale
- Matching property buyer leads with the right listing
- Decreasing the cost of customer acquisition
- Enhancing the efficiency of your real estate company
- Closing more real estate deals in less time
5. What Should Agents Keep in Mind When Using Predictive Analytics in Their Real Estate Business?
While entering the predictive analytics world as a real estate agent sounds impeccable, you should not get the wrong impression. Real estate is and will remain a people’s business which means that you and your real estate team will never be fully replaced by some big data, artificial intelligence platform. Predictive analytics tools can facilitate many aspects of your work, but you will still need to hold the reins of your business and add the human touch to close real estate deals successfully.
The real estate industry will never be the same again after the introduction of AI, big data, machine learning, and predictive analytics. This advanced real estate technology has given agents the tools they need to close more deals in 2020 than ever before, with fewer efforts and at a lower cost. To remain competitive and grow your business in 2020, make sure to figure out the best uses of predictive analytics for real estate agents for your particular case and start applying them today. Sign up now for a 15% discount on Mashvisor to get access to your Mashboard!