Can Big Data Become The Foundation For The Real Estate Of Tomorrow?
Big data can help understand communities in more efficient ways and empower the democratization of data for the real-estate consumer.
There are many innovative ways on how big data can have a great impact in the real estate industry. It is not a secret or a revelation that it plays an important role in many industries, especially within the finance and ecommerce world. Why? It has become a powerful tool for many companies to engage with more customers, get acquainted with their online preferences and behaviors, attract and target more buyers and sellers as well as drive revenue.
On a daily basis, businesses collect large amounts of data. It is a very powerful and useful tool, but this is not enough. The crucial part is what you do with it. Big data should be used to make better and informed decisions and take strategic action. For example, recent studies have concluded that more than 25% of the internet stores, including Amazon, are using big data to grow their market. Fortunately, for the real estate industry, this practice is starting to gradually change the way real professionals, buyers, sellers, and banks are reconsidering their business as well as the process involving property transactions.
How can big data benefit real state? There are two visible patterns that are highly beneficial for both, the real estate industry and their consumers. First, big data can help understand communities in more efficient ways. Second, big data can help empower the democratization of data for the real-estate consumer.
Big data can help understand communities in more efficient ways
Back in 2014, New York University and Hudson Yards developers announced a one-in-a-kind partnership: a smart-city project. This is initiative will measure the way New Yorkers interact with their urban environment to make “cities a better place to live.” It is the first “quantified community” in the entire country.
This is a project that will heavily rely on data. It is certainly promising that the largest private real estate development in US history – thus far – is also set to be one of the smartest. According the New York University’s Center for Urban Science and Progress, the mixed-use neighborhood will collect information on pedestrian traffic, air quality, energy production and consumption, and even the health and activity levels of workers and residents. Neither this project will be the first nor the last to blend big data and real estate in the pursue to create better places to live.
The democratization of data for the real-estate consumer
Rob Barber, CEO at Attom Data Solutions, in his article Democratizing Data: Toward Real Estate Transparency mentions, “This rapid increase in transparency is impacting real estate transactions and making the asset class more easily tradable. When combined with future generations of homebuyers who may not place the same emotional value on real estate as our parents did, we’re not far away from a meaningful portion of purchase transactions having similar characteristics to purchasing 100 shares of Apple or a new BMW — fast and low-friction.”
The consumer-centric-era together with the democratization of data for the real-estate consumer has transformed real estate. An important percentage of the real estate data is already easily searchable and presentable to all users and consumers. Even though, the issue with transparency has not completely been solved, the ability to know all things and to be informed has evolved.
Big data can become the foundation for the real estate of tomorrow. Now, combining the power of data with the human experience – a real estate industry that can interpret and overlay information and a consumer that is fully informed – is an even more influential combination.