How Big Data is affecting the real estate market
Big Data – the ability to process and analyze huge sums of information – has had significant impacts on pretty much every industry and real estate is no exception. Big Data has made it possible to quickly and accurately predict market trends and outcomes as well as risk and property appraisals. Here’s how Big Data is impacting the way agents navigate the real estate market.
What is Big Data?
While stats, numbers and large amounts of data about the real estate market have existed for a while, big data is a term that actually refers to how that information is used. Big data involves complex analysis of information, typically in extremely large amounts, in order to process trends and derive insights and conclusions from the information. Previously, with vast amounts of data, traditional calculations and analysis methods might have been too slow or labour-intensive to draw meaningful conclusions.
What real estate information is useful for Big Data?
With increased transparency in the housing market, more data is becoming available to the public. Every time a transaction occurs, there’s a wealth of information that’s derived — everything from the sale price to the length of days on the market. In addition, information like estimated mortgage payments, property values and even stats like hydro usage can be analyzed and processed to develop meaningful outcomes.
What can we learn about real estate from Big Data?
The outcomes of Big Data can help us make better, more informed decisions. Areas which benefit from the greater accuracy and precision of Big Data include home appraisals, current and future housing price estimators and predicting regions of growth. Ultimately, this increase in knowledge means less risk involved in purchasing property.
Will Big Data replace real estate agents?
We’ve all heard the cries of robots taking our jobs, and that includes concerned individuals in the housing market. But Big Data isn’t going to replace real estate agents any time soon. Sure, there’s more publicly accessible knowledge that a client may have previously relied upon an agent to deliver, such as housing trends and analysis, but having well-informed customers might make your job a little easier and transactions smoother since the clients’ expectations about figures like market values are more realistic. The knowledge and experience of a real estate agent is difficult to replicate with any amount of high-level data processing.