By Sotheby's International Realty
Agents from California to Greece are exploring the ways that AI is already changing the game for the industry and how the technology can benefit their clients; but buying & selling will always require the human touch, explains luxury brokerage Sotheby's International Realty.
The full potential of generative artificial intelligence (AI) remains to be seen, but what is already evident is the way the technology has captured the public's imagination. Its proponents see a future where users no longer need to spend time on mundane tasks like writing emails and can instead focus on finding new inspirations.
Stock market investors have already seen the benefits of AI, leading some to wonder how it will ultimately affect real estate - an industry that is a "historically slow adopter of new technologies" according to a recent report on the subject by consultants McKinsey & Company. The question is an important one, since the research found that AI could generate US$10 billion to US$180 billion or more in value for the real estate industry", according to the report. Real estate agents could also use AI in the near future to match buyers with their dream homes or investors with properties that will turn a better profit.
Pioneering luxury agents from California to Greece are exploring the ways that AI is already changing the game for the industry and how the technology can benefit their clients. "I use AI quite often," says Tyler Mearce, global real estate advisor, Sotheby's International Realty - Montecito Brokerage. Like many agents polled for this report, he finds the technology to be most useful in the creation of marketing materials, such as listing descriptions and Instagram captions. "We can get started with marketing and administrative tasks while we're still taking notes about the home. You drop in selling points like, 'Hey, I've got a beautiful Spanish architecture home located in Montecito, California, by the beach, four bedrooms, four bathrooms all en suite, beautifully renovated, here's the square footage,' and AI can help create an initial draft of the copy as inspiration."
"Speeding up smaller tasks allows agents to focus on the bigger picture, such as finding the right buyer".
Speeding up such smaller tasks allows agents to focus on the bigger picture, such as finding the right buyer. Not only does this save time in the fast-paced world of luxury real estate—"We signed this listing agreement 20 minutes ago; why haven't we taken photos yet?" Mearce jokes—but he's found that after editing, the integration of AI in the copywriting process tends to produce text that clients respond to positively, concisely summarizing the listing and highlighting key features.
Andrea Healey, global real estate advisor, Oceanfront Sotheby's International Realty on Kauai, Hawaii, has also found AI to be a valuable marketing tool—and in ways that go beyond generating copy. "It is so good at visualizing data," she explains. Her marketing plans tend to display "graphs specifically tailored to potential buyers" and she likes to include summaries of monthly activity in her regular outreach emails to potential clients, so they can be informed about the overall state of the market and make educated decisions.
"I save the stats from this month and the same month last year, then I give it all to AI and say: 'Can you please analyze this data, summarize it separately from the buyers' and the sellers' perspective, and then create graphs that summarize what it means? What AI created in five minutes would probably take me a couple of hours," Healey says, allowing her more time to focus on client care.
Perhaps even more impressive to Healey is the way that AI learns. Rather than having to teach the program how to do the work afresh each month, it recalls her previous inputs and preferences and repeats what it did the last time.
Both Healey and Mearce have found that in addition to creating content, AI is also useful for promoting it. It easily generates hashtags for Tik Tok, Instagram or YouTube, having learned which are best suited to reaching a particular audience so that tailored properties will show up in prospective buyers' feeds.
As impressive as all this is, it is just the tip of the iceberg. The potential of AI has revitalized the microprocessor industry, as demonstrated by the skyrocketing stock price of the U.S. silicon chip maker Nvidia, which in November 2024 unseated Apple to become the world's most valuable company, according to a report by Barron's. More powerful hardware and software are on the way, which means AI will be able to do more and increasingly complicated tasks in the future.
This excites many in luxury real estate. Savvas Savvaidis, President and CEO, Greece Sotheby's International Realty, is optimistic about AI's use in the future, particularly when it comes to what he sees as the holy grail of technology in luxury real estate: the possibility of using generative AI to pair sellers with potential buyers. "Matching the right properties with the right people is complex, involving far more than just square footage, budget or features," Savvaidis says. "Each buyer is unique and their circumstances, timing and even aesthetic preference can be nuanced and evolving. This is especially crucial in Greece, when considering the sheer number and diversity of its islands. Each one presents a set of considerations for potential buyers. AI could assist agents in navigating this complexity, offering tailored solutions that cater to individual preferences and lifestyles."
"AI should be seen as a powerful assistant, a brainstorming tool and an executive support, not a replacement for human expertise," Savvaidis says. "Its effectiveness hinges on the user's knowledge and experience, as AI requires guidance and feedback to truly shine. In the luxury real estate market, clients are seeking more than just a transaction. They want a trusted advisor who understands their aspirations and lifestyle. Negotiating complex deals, navigating emotional decision-making and providing a personalised service are all areas wehre human connection and expertise will remain paramount."
Savvaidis is not alone in seeing such vast potential for AI in real estate. A November 2024 report by the National Association of Realtors (NA) noted a plethora of other areas where it could prove useful, among them lead generation, client nurturing and property diligence. It even found that agents who make use of AI "are not only more efficient but are also perceived as more innovative and client-focused," according to NAR. "The automation of routine tasks allows these agents to focus on the irreplaceable, human aspect of their jobs - building relationships and understanding client needs on a deeper level."