Source: PPW Podcast Episode 4: The Future of Real Estate Search - YouTube
Participants:
- Edmund Keith, Online Marketplaces Editor
- Simon Baker, Former REA Group CEO
- Mal McCallion, founder of AI consultancy ModelProp
- Malcolm McCallio, founder of primelocation.com, then worked in property, and later helped set up Zoopla.
- Portals are in a phase of experimentation in four areas:
- Copiloting
- Discovering, using AI to help users find listings
- List enhancements, such as floor plans. Currently, lots of information is missing; AI may help fill the gaps from text or images and write better content. Virtual Home Staging on the fly.
- Internal processes
- JITI: Speaking to it and getting an answer about the kind of property the consumer is looking for. Attention spans are low; consumers want to save time by not looking through all the properties. Previously, those were the only filters you got, and that was it.
- AI is changing the search experience from search to discovery and recommendation. This poses an interesting challenge for the advertising model, as it is how portals monetize.
- If portals were about showing what the consumer is interested in, they would not make as much money. Portals take advantage of network effects they have created, and they have shared their strategy for the next five years, which involves not changing the model. But that assumes that consumers will keep the same search patterns. Google and others are going all in on AI for discovery. Portals will have to closely examine costs and see how AI can help reduce them.
- Portals are miles away from a reality where search is powered by AI. For instance, Idealista still can’t show which ads have an oven. And out of a list of 700 portals, many have a similar user experience. Ed seems quite skeptical about the changes powered by AI reaching fruition soon. He thinks that the current search does not need fixing.
- Voice assistants didn’t have the usage they were envisioned for. For Mal, the important stuff is NLP, not voice, at the moment. Natural Language search will become useful. There will be a pull, tension between AI capabilities and keeping margins, an innovator’s dilemma. Portals have no incentives to change until the change is irremediable.
- People have been educated on how to search using listings. To reeducate them to do it differently is a non-trivial exercise.
- Real estate agents and property marketplaces are intermediaries; they facilitate matching between supply and demand. There is tension between consumers and advertisers.
- Ed thinks that AI will allow portals to take on more of the roles of real estate agents. Agents have expertise hyper-local; if they can leverage that expertise, it will be an opportunity for them.
- Some data from real estate agents is unique, data that are in cabinets, and we can use OCR to try to complement data to portals data.
- In other markets where the agency industry is far less professional, portals can’t make money from them.
- Importance of having all teams AI-enabled to try to stay ahead of the competition.
- Zoopla leaned on AVM to gain an advantage and become the second portal in the UK.