Ai and the Rental Market

Artificial intelligence may still seem like it should be confined to the realm of science fiction films but it is already being used to great effect in the rental market.

Some of the latest ways that Artificial Intelligence is impacting the rental market

Using Artificial Intelligence Rentberry, in the US, has brought a controversial new business model to the market. Rental properties and tenants are matched through online auctions. The company uses AI technology to analyse local market data to recommend appropriate rental prices. The company also uses data to match and recommend landlords and tenants. This means that it isn’t always the best price that wins, but consideration is given to a tenant’s renting record too.

An AI-powered service called Eliot&me has been built by a Silicon Valley startup. It supports those advertising on Airbnb by recommending a fair daily and weekly rate. It takes into account the popularity of other properties in the area at different times of year to recommend separate rates for each month. The algorithm is said to learn from historical trends, supply and demand and competing services to suggest a fair price.

Airbnb does offer its own calculator but Eliot&me is more comprehensive and takes into account the number of bedrooms, bathrooms, guests accommodated and whether it is just a room or a whole building.

What does the future hold for landlords and letting agents?

Apart from using data to analyse market prices, how else might Artificial Intelligence be implemented in the rental industry?

We suggest that in the next 10 to 20 years:

• Rental marketing will become much more data driven. And that landlords and letting agents will need to be far more creative in the way that data is interpreted.
• Advertising will become more specific, targeting an audience of one. Individuals will see adverts personalised to their own needs and that are delivered just at the right time.
• Communication between tenant, landlord and letting agent could be through a ‘siri’ or ‘alexa’ type ‘chat bot’. This type of speech will improve so much that we will not be able to tell the difference between human and artificial speech.
• There will be fewer property viewings as prospective tenants will be able to view internal and external 3D walkthrough images online, perhaps even displaying their own furniture in rooms.
• Driverless cars will be used to transport prospective tenants to and from viewings.
• Viewings will be conducted by virtual assistants who will be able to answer any questions that the prospective tenants have.
• Credit checks and references will be less reliable than the ‘big data’ available about a prospective tenant.
• Most appliances will be connected to the Internet and, based on age and usage patterns, will be able to alert letting agents or landlords of imminent faults. And, if the fault cannot be corrected automatically, a virtual assistant could make the repair instead.
• Accounting will be fully automated and virtual currencies will be used routinely.

What does this mean for landlords and letting agents?

To remain in the property market, landlords and letting agents are going to have to keep up with these changes. Investing in new ways of communicating, enabling property viewings and even getting their property rented is going to be essential. Those that insist on operating as they always have done will not last in the age of AI.

To stay ahead, letting agents will not only need  to manage properties well but to cleverly interpret data too. Landlords will then see fewer void periods, fewer arrears, fewer evictions and more satisfied tenants.

On the flip side, there will be lots of new business opportunities for those brave enough and those with enough imagination to exploit this new technology.