By Kevin Hawkins with Korey Hawkins | Vol. 2 Post 3
Real AI is a 100% human-created weekly roundup of all things AI in real estate and emerging AI innovations in other sectors likely to impact real estate, posting a new edition every Friday.
AI survey reveals real estate’s heavy use, wide adoption
A brand new study from real estate tech leader Delta Media shows the popularity and use of artificial intelligence (AI) in real estate has become nearly ubiquitous among America’s leading real estate brokerages.
Today, 75% of America’s real estate brokerages already use AI technology, and almost 80% report that their agents have adopted AI tools.
The responses, compiled from more than 130 leaders of real estate brokerages representing firms responsible for 65% of all real estate transactions nationally last year, also uncover worries about risks related to unchecked AI usage.
Among the most striking findings come from gender differences:
- Female leaders recognize AI’s importance more, especially in mid-sized brokerages with substantial transaction volumes.
- A greater percentage of female leaders (85.3%) utilize AI in their businesses than male leaders (70.4%).
- Female-led brokerages, particularly those with medium to large agent teams and high transaction volumes, are the most likely to use AI.
- The youngest and oldest male leaders, overseeing smaller brokerages, are less inclined to integrate AI.
What’s the profile of the “typical” brokerage leader using AI today?
He (predominantly male) is an experienced senior executive helming a mid-sized brokerage. This contrasts with the characteristics of brokerages most actively using AI, often led by women aged between 31-39 or 50-59 years, managing a considerable number of agents and overseeing substantial transaction volumes.
Among the other top findings:
- More than half of the top brokerage execs said they are “worried or very worried” that AI “does not have the appropriate guardrails” to limit their risk or liability around it.
- Real estate agents employ AI in their day-to-day business, primarily leveraging this technology to craft property descriptions (82%), followed by generating blog posts, emails, and letters (67%), social media content (60%), website content (44%), and writing personal bios (43%).
- AI is not just present but growing, with executives rating its current importance to the industry at 5 out of 10, which surges by 40% when asked about AI’s importance in the “near future.”
- Leaders note they plan to leverage AI in the future; digital marketing (73%) and social media (72%) are the leading anticipated uses.
- While some experts predict 2024 will be the year of AI personal assistants, only 23% of brokerage leaders see AI used for front-office or admin support this year. Remarkably, one in ten (11%) have “No plans to use AI” this year.
AI fears
But rapid AI adoption in residential real estate isn’t without some misgivings: More than half of the top brokerage execs responding said they are “worried or very worried” that AI “does not have the appropriate guardrails” to limit their risk or liability, with female leaders slightly more concerned than their male counterparts.
The highest level of worry is among brokerage leaders aged 60 or older, especially those managing smaller teams and lower transaction volumes. Conversely, middle-aged leaders of large brokerages with massive transaction volumes exhibit the least concern.
Michael Minard, owner and CEO of Delta Media and an AI thought leader, notes, “As AI reliance grows, brokerages need assurance that their tech partners providing these tools have sufficient safeguards to protect them from the potential downsides. Managing risks remains an imperative even as competitive pressures make adoption table stakes.”
AI Fast Facts
- Nine in 10 global organizations believe AI will give them a competitive edge over their rivals – MIT Sloan Management
- Nearly 40% of large companies plan to use AI, according to Adobe, but among real estate brokerages, usage is nearly double that (75%), according to Delta Media.
- Studies show that almost 100 million people will be working in the AI industry by 2025 – We Forum
- Nearly 4 in 10 marketers believe that AI email marketing improves market revenue – Statista
- AI and Machine Learning are expected to replace about 1 in 6 US jobs in less than half a decade – Forrester
Sources: Various collected by Exploding Topics
AI Headlines: Take 5
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How CTOs can make the case that AI investments create value | 1/12/24 Fortune
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2023 Was About Using AI. 2024 Is About Using It Better: Mosaik CEO | 1/16/24 Inman News
Mosaik founder and CEO Sheila Reddy discusses AI’s future ahead of Inman Connect.
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