What Exactly is Big Data?
In real estate, big data refers to the collection, storage, process, and analysis of data related to the sector of business in all areas of real estate transactions. This information helps to anticipate opportunities and trends, which in turn helps consumers (both buyers and sellers) to make more informed and efficient decisions.
In the past, real estate based decisions were made solely on professional experience and historic trends. Sometimes professional experience was purely “by heart” or anecdotal in its scope. Historic trends could be based over years and decades not weeks and days. With big data, today’s analytics empower real estate professionals to make data-driven decisions about sales, purchases, rentals, and property management of physical properties.
How Can Big Data Improve the Real Estate Experience?
Data today allows for greater accuracy in real time, which gives not only a clearer picture of opportunities but also a much more accurate snapshot for risk assessment. With constantly changing real estate markets and quickly changing economic times knowing the smallest, most nuanced differences in trends can make all the difference. Predictions based on data points like search engines, social media, Yelp reviews, and online surveys help real estate professionals focus their efforts, which in turn gets passed along to the consumer.
The Future of Real Estate and Big Data
According to Bright Data, big data is being leveraged in real estate in six major ways:
- A Wider Scope of Analysis
For example, the mortgage industry can study data to learn more about the average consumer’s purchasing power according to up to the moment median household incomes.
- Property Evaluations
Data drives these evaluations can be more accurate due to information collected on home appraisals, current supply and demand, sales volume, and the fluctuating costs of building materials.
- Home Prospecting, Marketing, and Sales
The use of digital advertising and marketing can help to refine home selling and home buying audiences. Additionally, marketing can be directed and targeted to buyers based on government records or other important information being collected.
- A Boost in Property Development
Another way data may be used in the future is by better understanding correlations between social media and location services when people check in and share public locations and pinpointing land parcels or areas that are trending.
- Data-Driven Risk Mitigation and Property Insurance
Data analytics may help provide buyers and sellers with information about the accurate amounts and types of insurance related to home ownership in a much clearer way than ever before.
- Digitization of Management Processes
For those involved in property management of either residential or commercial properties, data analysis can offer insights into the performance of various systems and asset strategies.