More than half (54%) of real estate professionals surveyed by Drooms use AI to improve the keyword search process when working on transactions. However, this figure rises to 69% of respondents who say they will be using AI for keyword searches in five years’ time. Other processes that will become more widely used include foreign language translation, identifying red flags, routing documents to the right decision makers and topic modelling.
The majority (76%) of respondents believe that AI will always work best in conjunction with human intelligence, compared with 18% who think AI will eventually be a substitute for human skill and intelligence in real estate processes. Just 4% said that AI would never be a substitute.
More than two thirds (69%) of respondents believe that AI benefits their firm and gives it competitive advantage by enabling a much higher volume and variety of documents to be searched at high speed. Almost the same number (63%) say that AI speeds up the due diligence process, while 35% believe it improves the accuracy of decision making. Other benefits of AI include minimising risks and liabilities in an overall deal (24%), reduced reliance on legal services (10%) and securing the best deals before other professionals (9%).
When asked where AI has the greatest impact on improving the efficiency of processes, three quarters (75%) said ‘identifying relevant documents in a virtual data room’. More than two thirds (69%) said it was ‘avoiding time-consuming manual review processes’, 53% chose ‘preventing human error’, 36% said ‘automatically creating contracts and reports’ and 16% said ‘deciding who needs to view and make decisions about data’.
The barriers facing AI
Despite these benefits, there are still perceived barriers preventing the uptake and use of AI in the real estate industry. The biggest of these is lack of confidence in AI’s ability to match human intelligence and decision-making (cited by 53%), followed by a lack of skills available to implement relevant AI technology (51%), technology being too difficult to use (41%), lack of trust by senior management in AI (19%) and concern that AI will replace investment professionals’ roles (17%). Only 9% say the main barrier was ‘lack of demand’.
Jan Hoffmeister, Co-Founder of Drooms, said: “We agree with the majority of respondents to our survey that AI will always work best in conjunction with human skills and intelligence. AI needs to learn from human behaviour and there is no substitute for years of experience, instinct and knowledge. However, AI complements those elements and adds huge value by making real estate processes much more automated, efficient and cost-effective.”