Artificial intelligence is being used to help prospective buyers narrow their searches. Increasing the amount of data available directly to consumers gives them more bargaining power.
“We were traveling to Annapolis on the weekends to look at houses, and we wanted to buy our future retirement home before rates go up,” said Tom Luscher, a naval officer based in Norfolk who used apps to buy a home with his wife, Jen.
Their agent “sent us links through the Homesnap app that were really focused on the location and the price range we wanted,” Luscher said.
Luscher said he also used the Zillow app and found it intuitive. He liked the mapping capabilities that allowed him to use Google Street View to look at the area around potential properties. He said he was able to skip touring some houses because of that function.
Searching online for properties is the first step for every generation of buyers, except for those 72 and older, according to the National Association of Realtors’ 2018 Home Buyer and Seller Generational Report.
Thus, real estate listing services are ramping up their sites and introducing new ones that adapt to buyer demand for instant gratification.
“We try to make home shopping as effortless as possible for buyers, so all they need to do is take a photo of a home with their phone, and they can get an instant pop-up with details and financial information,” said John Mazur, chief executive of Homesnap, which has about 17 million monthly active users.
“We’re constantly adding new things to the app to stay on the leading edge of innovation, with things like artificial intelligence and augmented reality,” Mazur added. “We use data to make the whole process of searching for a home easier and seamless.”
Homesnap data is updated at least every 15 minutes, through a direct feed from multiple listing services for properties across the country. Homesnap entered into a joint venture with Broker Public Portal (BPP) in January 2017 to develop a national property database owned and operated by multiple listing services and real estate brokerages. The joint venture with BPP means that Homesnap’s data is accurate and detailed, which helps buyers compete for homes, company officials say.
Chris Cox, a home buyer in Alexandria, said he and his husband found the constant updates on Homesnap helpful in the fast-paced housing market, especially because they had lost out on two previous homes before their recent purchase.
“Every home on Homesnap includes complete information about how many times it’s been on and off the market or had a new price or listing agent,” Cox said. “ We used that information to inform our bargaining. For instance, we decided not to make an offer on a house where the sellers had increased the price even though it hadn’t sold for nine months, because we knew they wouldn’t negotiate.”
“Consumer expectations are rising faster than ever,” said Jeremy Wacksman, president of the Zillow brand at Zillow Group. “People expect to push a button and solve a problem, so everyone is looking for smarter ways to help people shop better for real estate. We’re using big data to personalize the search.”
Even if they sometimes resent the collection of data about their buying habits, consumers have become accustomed to targeted ads on social media and in their email inboxes based on their online searches. Real estate apps have jumped into this personalized experience, too, in an attempt to streamline the property search experience.
“We take the data from hundreds of millions of homes and create a treasure trove of intelligence to make recommendations for buyers that show up on our site as ‘homes like this’ when buyers are looking at properties online,” Wacksman said. “It’s similar to Amazon’s ‘best picks for you’ products that are based on prior activity.”
Machine learning and artificial intelligence build more efficient tools for buyers based on their online behavior, said Chelsea Goyer, vice president of industry relations at Redfin brokerage and a board member of BPP.
In addition, Redfin’s site has extensive photos and 3-D tours to eliminate the time-consuming aspect of touring every potential property.
Twenty percent of buyers said they made an offer on a property they hadn’t seen in person, according to a May 2018 Redfin survey.
“We can send recommendations to buyers based on the house tours they’ve booked online or offers they’ve made, which helps them find a home faster,” Goyer said. “We also use data to highlight ‘Hot Homes’ that we think will sell in two weeks or less, and to generate a ‘Compete Score’ so buyers know what the market is like in a particular area.”
Home hunters who are used to setting filters to narrow their search based on price, location, and the numbers of bedrooms and bathrooms will notice a change. They will find that some sites are shifting away from searches that “filter-and-scroll” and then add more filters, in favor of a search aided by artificial intelligence.
“We try to replicate the human experience of discussing what trade-offs people are willing to make online,” said Dave Mele, president of Homes.com. “As buyers set filters, they can choose ‘must have’ and ‘nice to have’ for features, which eliminates the tyranny of rigid filters. Our algorithms personalize the search and show you 100 percent matches, as well as other matches.”
For example, let’s say you’re searching in the $300,000 to $400,000 price range. A home that matches everything in your filter — neighborhood, number of bedrooms, square footage — that is priced at $405,000 will show up as a possibility with a 96 percent match score.
Access to immediate, relevant data is essential for consumers and for agents, said Mazur of Homesnap, and mobile apps allow everyone to be productive when they are out looking at homes.
“After three decades of moving around the country, I found it extremely helpful this time to have pricing history on properties at my fingertips,” Luscher said. “That really empowers buyers to be able to do our own due diligence.”
The home-buying process for most people is a collaborative effort that includes a real estate agent, a partner or spouse, parents, and sometimes other friends or relatives.
“We know home shopping is a team sport, so we developed ‘Home Share,’ which makes it easier to share listings and capture feedback without copying a URL for the property and emailing it or texting to multiple collaborators,” Mele said. “Buyers can ‘favorite’ a house with a heart, and then invite collaborators to give a thumbs-up or a thumbs-down. It’s like sharing a playlist on Spotify.”
Buyers using Zillow can use the “My Agent” feature to communicate with their agent and can collaborate through the app with several people at once.
Agents can also communicate quickly with one another using apps. For example, on Homesnap, all communications around a particular property include the listing information, so there’s no confusion about which property is under discussion, and you don’t have to track down emails and text messages, said Lisa Coutts, a real estate agent with Compass Real Estate Brokerage in the Washington area.
Cox, who worked with Coutts, said he prefers texts and emails to using the app to communicate with his agent because he wasn’t always logged into the app.
“But my husband and I liked to be able to share links through Homesnap to houses we liked with each other and with friends for opinions and advice,” Cox said.
On Homesnap, buyers can collaborate with their existing buyer’s agent, find a new buyer’s agent, or contact the listing agent or even the agent who previously sold a listing.
Unlike sites such as Zillow, Homesnap doesn’t accept advertising from agents. When consumers search for houses on sites such as Homes.com and Zillow, they see a list of potential agents they can contact who have paid to have their information displayed but might not know about the house that interests the buyer. All sites display the listing agent for each property, but buyers need to be aware that the listing agent represents the sellers for a particular property. Buyers can contact that agent for information but should hire their own buyer’s agent if they want to make an offer on that house. They can also choose to work with that listing agent to find other properties.
Future tech updates
Although technology already streamlines the home search experience for buyers, ongoing enhancements are expected to personalize the process more.
Homes.com is working on a “snap and search” feature that allows people to search for a home based on a photo they have uploaded.
“Even if that property isn’t for sale, we can use artificial intelligence to find a house that looks similar in a city or Zip code or neighborhood they want to live in, and send them potential matches,” said Mele of Homes.com. “We’re also working on developing photo-based searches to match a kitchen or a patio picture that someone has seen on Pinterest or uploaded themselves.”
Mele said he anticipates that, someday, voice-driven searches will take over from apps.
“People will say ‘Alexa, can you find me a house?’ And then there will be a series of questions to narrow the search,” Mele said.