Real estate agent and reality TV star Ryan Serhant.
Newspeaks
Real estate has historically been slow to modernize, but AI is changing that. The integration of AI is changing how buyers and sellers interact with agents, fundamentally changing the competitive dynamics in the industry.
As AI reshapes the day-to-day operations of a real estate agent's business by automating tasks — from creating real estate listings to performing neighborhood analytics — the agent's focus in daily activities will shift.
AI is making real estate less about access to information and more about the agent building deeper relationships, says Ryan Serhant, CEO of Serhant and a reality TV star on “Owning Manhattan.” He expects a mindset shift to be on its way as agents benefit from AI while at the same time having to find new ways to differentiate themselves in an increasingly competitive market. “If we're all using AI and have the same level of expertise, who's going to win? It's an attention game,” Serhant said at the CNBC Evolve AI Opportunity Summit in New York City last week.
Purchasing a home is the largest investment most Americans will make in their lives, making real estate a business in which greater success can be achieved with a greater personal touch on the part of the agent. Serhant says the big advantage he sees in using AI is freeing up more time for a real estate agent to provide personalized attention to his clients.
“Product in sales is no longer just a set of skills,” Serhant said. “It's paying attention to the skill set.”
His own company, Serhant, has developed a sales automation service called Simple to handle the day-to-day tasks in customer relationship management, which typically consume more than 60% of agents' time.
AI tools are used to streamline lead generation, automate marketing campaigns, and provide predictive analytics to identify opportunities, but this does not replace the agent's critical role in delivering peak performance. Serhant says AI won't make relationships virtual, but for real estate agents who embrace the AI revolution — which he says is a necessary step to take — it will enhance their relationships.
Making access to real-time market data and sales insights less difficult may allow small business agents to compete on equal footing with larger real estate companies. “There's a trust factor in sales,” Serhant said. “It's not about who's the biggest, it's about who's the most empowered.”
This will also benefit homebuyers and sellers, with a wider range of suitable agents with enhanced personal services and greater client focus, Serhant said.
The real estate industry is still in the early stages of AI adoption and understanding is still low among real estate professionals, but interest is there. Generative AI has been ranked among the top three technologies expected to have the biggest impact on real estate over the next three years by investors, developers and occupiers, according to the 2023 Global Real Estate Technology Survey conducted by JLL Technologies. But the survey also found that real estate professionals have a very low understanding of AI compared to other technologies.
According to Srant, agents who understand how AI can empower their businesses will have tremendous opportunities over the next 20 years to gain significant market share.
No technological innovation is without risk, and cyber fraud remains a major challenge for the real estate industry, which will be exacerbated by artificial intelligence. The FBI announced a significant year-over-year increase in online fraud crime losses in 2023, driven largely by real estate transactions. Improved AI technology makes it easier for real estate scammers.
Serhant said fraud cannot be ignored, but he believes real estate will adapt to the risks inherent in new technology in the same way the company has in the past, as with digital listings. “With every advance in technology, greater rules are put in place that can help stop these counterfeit products,” he said.
