Making wise investments has always counted on having the right data and
spotting future trends. The trouble is, there is so much data and so many factors
that affect trends that it takes a huge amount of effort to make sense of where
and what to buy. Advances in artificial intelligence and geospatial data analysis
are proving enormously helpful for planners, developers, and investors alike
when it comes to real estate. From knowing where to build to knowing what to
buy, how much rent to charge, and even what renovations will give the best ROI,
computers really are the new crystal balls. What is geospatial data? Essentially,
it’s a map – but this is the most detailed map you can imagine, being updated in
real time with highly specific information about every location. Geographic
Information Systems use AI to analyse these maps and help us visualise and
understand needs, trends, and opportunities.
The housing sector in the UK is in serious need of a technological overhaul, and
several firms have recognised this need and are starting to apply Geographic
Information Systems and AI technology in many ways. Analysing multiple real-
time datasets such as population density, mappings of infrastructure such as
hospitals and schools, commuting paths, and environmental factors, GIS AI can
quickly provide helpful information to planning authorities on areas suitable for
development. Post-Covid, it can also provide insights into where high street retail
and office space is not going to come back into use, and even show details on
how much infrastructure would need to be implemented in order to redevelop
these areas into housing. These analyses are incredibly helpful to national and
local governments and developers alike, and will hopefully serve to help
streamline and speed up planning processes. Processes of data and document
collection needed when preparing planning applications, that done manually can
take weeks, can now be done in seconds.
At the next stage, GIS is being used by real estate agents to find where their
best customers are going to be, what rental prices to charge, and to match
buyers and investors with their ideal properties. Land registry and census data
tied to specific locations can all contribute to decision making. Finding out rental
prices on comparable properties is made easy when you can analyse exactly
what makes a property comparable – not just size and condition, but location in
relation to amenities, commuting times, air quality – whatever factors are
important to the clients.
The crystal ball analogy, however, can be taken further – the fortune teller may
provide information but the information can be vague, clouded, and ambiguous.
Artificial intelligence can only analyse data that, sadly, has been measured and
provided by mere mortals. When it comes to analysis on a small scale, for
individual addresses or postcodes, sometimes the data is just not there. Figures
may be outdated, or even just wrong. The way data is recorded might not be
standardised over all areas of the country, or it is simply not granular enough. In
short, the AI can only give you predictions as good as your data. At worst, you
could even be misled by your results. With Building Information Modelling tech
also developing apace, the problem of low-detail data will hopefully soon be a
thing of the past. Until then, there are already some solutions to this, some of
which are expensive, but worth it – buying good data could lead to valuable
predictions. Another way around lack of data would be to find a similar location
that is data-rich, and use that in an algorithm to model predictions for your data
poor location.
This technology is hugely promising and is already being put to some use across
the real estate sector. At the moment, we have not been fully replaced by
robots – the data going in is provided by humans, and the analyses, information,
and predictions coming out can only be used by humans as part of their decision
making process. The AI is not making our decisions for us, but it is making it
possible for those of us who do not have the time or inclination to spend months
gathering data and poring over maps and statistics to nevertheless be able to
make wiser decisions when it comes to almost any aspect of real estate building
and investment. Those businesses that are investing in and adopting GIS
technology early are giving themselves a serious edge.
All of this digital data, location mapping, building information modelling, and the
need to be ‘agile’ in this fast changing world (both in ‘meatspace’ and
cyberspace) means data capacity and speed is more important than ever. The
rollout of 5G in combination with this new PropTech is going to revolutionise the
industry, hugely improving its efficiency and its ability to deliver exactly what
people need. At least, that’s what my crystal ball told me.