Since technology experts first figured out how to begin harnessing big data, it has been transforming the way business is conducted in so many industries. Real estate is no exception. The vast amounts of real estate intelligence now available help make the market become more predictable and easier to understand. As big data provides buyers, sellers and Real Estate Agents with greater access to vital information, all three groups are able to move through the home buying and selling process with more confidence.
What is Big Data?
It is a phrase that has been tossed around for years, one you have probably read about in countless articles, but have you ever stopped to think about what big data actually is? What qualifies certain pieces of data as "big"?
Big data is big because "the volume, velocity or variety of data is too great" to keep track of using conventional data collection methods.1 The Internet, of course, is the big data gold mine, where companies allocate tons of resources to track consumer behavior. It is not only used for capitalistic reasons, though. Big data can be used for almost anything. For example, governments can use it to track the development of a disease outbreak through social media, or a utility company could use it to track energy consumption in homes and determine when a power outage will occur. It combines tracking and analysis in real-time, requiring technology that collects data as quickly as social media users can update their Facebook statuses.
"With Big Data, Real Estate Agents are able to provide better service to their clients."
How Big Data Helps Real Estate Agents
With big data, Real Estate Agents are able to provide better service to their clients, as they are able to collect more information about local housing markets and assist them accordingly.
Big data allows Real Estate Agents to track what people in the area are typing into search engines in regards to real estate. Not only does this search data help Real Estate Agents figure out the most popular characteristics people are currently seeking in a home, but it also helps them determine the location with the greatest demand for homes and tailor their marketing strategies toward those areas. When Real Estate Agents know exactly what buyers are looking for, they can provide a better customer experience by featuring homes on their websites that they know the majority of buyers would love.2 All of this, however, is just the tip of the iceberg.
"Patterns and trends in real estate data can be used to help decide where to locate a new office or how to identify and recruit top-producing agents to your company," John Heithaus, chief evangelist for big data firm RealEstate Business Intelligence, told RISMedia. "Big data can also help you qualify buyer and seller prospects more accurately and achieve higher closing rates. Using big data adds value to client interactions, but also differentiates your business as a high-tech service firm."3
In addition to helping Real Estate Agents learn about the specific types of homes and locations people want, big data can also provide agents with information about the state of the housing market, which not only helps them make better decisions but also makes them more trustworthy and credible in the eyes of the clients.
How Big Data Helps Homebuyers and Sellers
Big data is helping buyers and sellers make more informed decisions. For example, when it comes to pricing, buyers have more access to information about what other similar homes in the area are selling for, so they will know if a house they are looking at is overpriced. Sellers will also have access to that information, which can help them price their homes more appropriately.
In short, big data is arming buyers, sellers and Real Estate Agents with more knowledge and expertise. It helps Real Estate Agents earn more business and provide better customer service, and it helps buyers and sellers feel more confident in their decisions. As it continues to dictate industry trajectory, it's in the best interest of all involved parties to educate themselves accordingly.