Big Data In Real Estate Industry: Main Reasons To Adopt It Right Now
A couple of quintillion of bytes are generated every day. Data is all around you. And every day we perceive new data and our brain processes it constantly. But we cannot constantly work with huge data volumes efficiently, that is where special algorithms for processing Big Data come in. Bis Data contributes to many fields of activity, and today it is rapidly being integrated into the real estate sector.
What results can it lead to and why it may be a necessary information for your real estate mobile or web app development ? We recommend you to read this article!
Why is Big Data changing real estate sector?
Nowadays IT technologies drastically change the structure of the commercial real estate market. Innovative technologies change almost everything in real estate sector, starting from the business model building, human resources management or optimization of expenditures.
Big Data is one of the technologies that gained its popularity in the real estate markets of many countries. The goal of Big Data technology is to automate the analysis of huge amounts of data from multiple information sources. And human capabilities will not be enough to process all this data. Therefore, companies will be able to optimize financial costs, time, and achieve a more accurate result that won't be affected by a human factor.
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Big Data works with machine learning to solve main business tasks. Huge data massive is analyzed according to set algorithm, and artificial intelligence provides people with the solution of a specific task. The most widespread example - credit appraisal of a borrower in banking or microfinance sector. Many banks already make their decisions on loan issuance on the basis of the verdict from an automated system.
The future of Big Data in real estate
Big Data potential usage on real estate market is multipurpose. If it comes to an end consumer, then real estate Big Data can help consumers appraise objectively various real estate objects by multiple parameters. Modern real estate databases offer rather limited information volume about different objects interesting for you.
The potential of Big Data in real estate
- For example, real estate predictive analytics with Big Data technology helps to estimate the time you need to spend to go to the specified object in rush hour, how many schools and kindergartens are located in this area, and other related issues;
- Thus, Big Data makes it possible for an individual to make a quick decision whether he/she needs to waste their time on this object or it is better to choose something else.
As for business, Big Data potential can also be titanic. Technology can be highly efficient for marketing fields starting from personalized offers to end consumer to the determination of real estate object type with all tiny properties that can be built in that or another location.
Advantages of Big Data in real estate
So what are Big Data benefits that make it possible both for real estate agents and consumers improve their interaction with this field? It is time to find out.
First, we should clarify that commercial real estate companies start using Big Data since it helps them reduce financial risks. How is it implemented? Using predictive analytics in real estate, companies can analyze the total condition of the building, its age, how solid it is, all reconstructions that were made before, and the information about the current owner. Based on all the above, real estate companies can make a correct estimation of the real property and provide customers with detailed recommendations and information. Moreover, real estate agents can quickly find appropriate variants for customers that meet their demands and preferences.
Data-driven analysis can come to the rescue. Real estate agents often come across ambiguous and unclear customers' behavior which cannot explain why they don't like this house or why they don't want to buy it. That is where analysis using Big Data can help solve this issue once and for all. Predictive analytics for real estate is very important. Special tools developed by software development companies like Cleveroad can analyze the needs of consumers and improve their engagement. Perhaps, undetermined requirements of customers may even come to naught eventually and agents/companies will offer customers what those want to get.
When people sell or buy a house/apartment, they want to know its real price. And the process of the correct estimation is rather difficult and long since it requires the full information about the building condition, location, area and so on. So prices can be changed drastically depending on many factors. Big Data is an option, as always. Using special analytical tools, real estate agents are able to perform accurate appraisal and set a real value for the indicated building. Big Data will provide users with actual information on the basis of the neighborhood, area, total conditions of buildings and so on. Thus, agents and consumers can get the most realistic price, and both parties benefit. Using Big Data, real estate sector can be completely modified.
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As we noted above, Big Data is tightly connected with artificial intelligence and machine learning in particular. And machine learning with Big Data creates transparency in business processes with real estate, and also machine learning algorithms are able to process a huge amount of data within a short period of time. If these algorithms built by skilled developers, they can implement really hard work. As a result, real estate companies can make all important decisions faster since they are provided with accurate data that is maximally objective in the current time period. Say no to artificially inflated prices! So fraudulent actions will be minimized due to real estate data analytics.
Big Data and real estate can also be mutually beneficial for marketing purposes as well. Real estate agents use social media to extract necessary information about customers with the help of Big Data and machine learning algorithms. As a result, agents can contact potential customers at the right time when people are going to buy or sell real property. In turn, agents can also monitor all trends and actual prices, it provides them with an opportunity to offer customers more profitable variants. Everyone gets the benefit!
Some real estate companies also offer insurance services since many people insure their dwellings when they buy it. That is why insurance companies need Big Data processing to know what insurance plans are applicable in this or that region. Big Data analytics for real estate insurance makes a large contribution to this sector. Thus, insurance companies know in advance what insurance type people need in their region. It will allow them to create custom plans for each region. It sounds great.
Strong sides of Big Data in real estate
Mind that everything mentioned above works only if you have an appropriate custom software that will use Big Data together with machine learning algorithms. Experienced software development companies will help you build a high-quality product. As for our skills, Cleveroad has enough experience to work with real estate software and Big Data.
Big data use cases in real estate
Having clarified the main benefits, it is the time to speak about use cases or ways of application of Big Data in the real estate sector. How do real estate companies use Big Data? Hurry up to see it.
Data democratization and more transparence
All real estate companies change their approaches and strive for data democratization (i.e. building of more transparent and clear data) for all potential and current consumers. Thus, such famous companies like Trulia, Redfin, Zillow, and others work on processing of real estate industry data and providing people with a detailed information regarding latest surveys, full lists of homes/apartments for sale/rent, maps with regions where you can filter real property by its value and so on. So the main idea of companies is to give people clear and authentic information, decrease fraudulent and obscure schemes to zero.
Zillow company can boast about its contribution to Big Data software. The company created Zestimate tool that is capable of estimating real home value and determine average market value in different regions. Moreover, Zestimate will offer you predictions regarding future value on the basis of current market information. Machine learning algorithms can make all prediction rather accurately, so real estate data analysis plays its important role.
Real property selection by advanced filters
Using Big Data in real estate, apart from transparency in information, nowadays people are able to find all the actual information about the region where they plan to buy a house, for example. As this sphere also requires a huge amount of data, Big Data processing is used here successfully.
- Property particularities. All detailed information about different regions, where customers may study what neighborhood is over there. Besides that, each customer has its own interest, for example, you need to find out what universities are located nearby since your children need the educational establishment to study. Whereas your friend wants to know what is about entertainment - nightclubs, cinemas and so on. All this advanced info you can find on real estate websites;
- Crime rate. Nobody wants to live in a deadly and dangerous neighborhood where you or your relatives can be hurt. That is why crime rate indices are very important for customers before they make their decision to buy a real property. To calculate all these rates, companies use Big Data, of course;
- Education levels. Big Data real estate analytics helps customers see how prestigious and popular educational establishments (schools, colleges, universities) in the region they need.
It is just a few examples of Big Data application in filters when you investigate information about the real property. By the way, to collect the information mentioned above, the Internet of Things technology can also be applied. Keep on reading!
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Different sensors installed in homes and around them gather various data like pressure, temperature, the number of visitors, ecological standards etc. We call it the Internet of Things. As a rule, data flow from one house isn't very large, but large infrastructures send a huge amount of data where Big Data technologies should be applied since it may have a negative influence on the performance speed.
Thus, Big Data in commercial real estate can help you create decision-making systems with machine learning that will automate building maintenance process as much as possible, and it will be one specialist enough to deal with it instead of a large team. Integration of Big Data will significantly increase the efficiency of data flow and maintenance.
Searching for land plots to build real properties
You may be surprised, but this process is rather complicated and companies work on it using various models and algorithms. This task requires many resources so the application of Big Data is reasonable. Big Data algorithms will simplify the process and they will help value the efficiency of the office, shop or mall functionality in the specified region. Machine learning tools with predictive analytics will be able to predict the expediency of building for a few years ahead. Real estate and Big Data prove again its successful collaboration.
And the last but not the least one Big Data use case is a promotion. Real estate companies use real estate Big Data analytics to analyze the interests and preferences of customers that visit their websites and they work on the improvement of this information. Every day they can modify their information according to people needs. As a result, customers get a high-quality service, and companies increase the engagement and multiply revenue.
Trulia company has released a Trulia Insight software - the tool that is used by Trulia employees to study customers' preferences and needs, their purchase history and financial statuses. Having launched this tool, Trulia specialists succeeded to identify quickly 72% of their customers that are ready to buy a house at the moment.
How Big Data can be used in real estate
Based on this, Big Data can drastically modify the real estate sector, so if you have a real estate business or you plan to occupy this niche, mind to use Big Data technologies.
How can Cleveroad help you benefit from Big Data?
As you can see, the future of commercial real estate Big Data is very optimistic and we simply cannot ignore it. So you should think about the development of your own data-driven software with machine learning algorithms. And Cleveroad can lend you a helping hand.
- First, you can build your custom real estate software according to your personal needs. You can use ready-made apps, but the majority of them have limited functionality that can be inappropriate for you;
- You may need an app for a smart home that works with Big Data, and you can make a profit from it since such app will be powerful and efficient for many people which live in a smart home. Our guide to smart home app development can be also interesting for you.
- Internet of Things: this is a popular and profitable field for today. It is tightly connected with the principle of smart home maintenance, but IoT is a wider conception and it can be used on warehouses or office building. Read more about IoT theory and make your decision.
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