Artificial intelligence (AI) is simply the level of intelligence displayed by machines. While mostly associated with science fiction and futuristic technology, AI is actually a lot more ubiquitous nowadays than one might expect. Some of the AI applications that are already out in the public include those in self-driving vehicles, search engines such as Google, financial services, health care and even in art and video games.
Now, the obvious question is, how is AI useful in real estate? In particular, in Dubai’s real estate landscape are there initiatives to embrace the technology and make it more meaningful to landlords, homeowners and realtors? According to Dr Johan Himberg, inventor, author and one of Europe’s leading data scientists, Dubai actually plays a very important role in the development of AI, not just in real estate.
“Dubai has made one of the world’s boldest commitments to AI, now we need to ensure those interested in this technology are equipped to see through the hype and deploy it wisely,” says Dr Himberg, who has visited Dubai to help government and business leaders implement AI. “Dubai’s real estate is already world famous, so it’s great to be invited to demonstrate how AI can further this success story.”
Reaktor
Dr Himberg has nearly 20 years of experience working with data, analytics, machine learning and AI for the Finnish government and international brands with Reaktor, a global technology firm from Finland, which recently expanded operations in Dubai. With Reaktor, Dr Himberg wanted to see how AI could help real estate investors, agents and residents better predict house and rent prices.
Presenting at the Dubai Real Estate Institute’s (DREI) best practice event on innovation, Dr Himberg, who is the chief data scientist at Reaktor, provided real-life examples he launched in Finland that helped industry professionals see how AI can work for them and their customers. Using data amassed from rental and purchase transactions across in Finland, Dr Himberg said Reaktor was able to apply AI to determine realistic house and rental price predictions across the city. The result was a simple, easy-to-use, navigational online map of Finland, showing pop-ups of past and future residential rental and purchase price trends.
“We’re pretty much a hierarchy-less organisation at Reaktor, made up of highly experienced technology professionals, all given the freedom to follow their curiosity — this allows us innovate in a very agile way,” says Dr Himberg. “We built the AI-based house and rental price predictor for Finland from scratch in just a few months; now that we’ve proven it works we could potentially launch something similar in Dubai very quickly.”
DREI’s collaboration with Dr Himberg is in line with the government’s commitment to explore new ideas and solutions to various industry challenges, according to Mahmoud Al Burai, CEO of DREI.
“We need to be open to different ways of thinking, which is why it’s important to give people with Dr Himberg’s calibre of expertise a platform to share their idealism” says Al Burai. “I’m really encouraged that innovative companies like Reaktor are choosing Dubai as a place to do business and seeing growth opportunities in our real estate industry.”
How it works
After showcasing how Reaktor’s price prediction AI tool worked for those looking to buy, rent and invest in property, Dr Himberg went on to reveal how it developed into a service for those looking to sell their homes themselves. Using a web tool created for a Finnish real estate firm, a private seller can get a realistic selling price by inputting a few basic details about their home, such as its zip code, condition, build date and the number of rooms and floors.
This immediately gives an estimated sale price based on similar property transactions, also comparing it to prices in more expensive and cheaper neighbourhoods. This gives home sellers a better chance of making a sale, as well as giving real estate agents a compelling new service to sell to a market that would otherwise have gone it alone.
“There’s a lot of excitement about AI, largely driven by fears it will take our jobs, or evolve into something we can’t control,” said DR Himberg. “AI has been around a long time; we’ve had machine for nearly 60 years and we still have jobs. Technology has replaced jobs for generations and we’ve adapted, when elevator operators became redundant I’m pretty sure they found other jobs.
“AI is great at doing a simple job it’s told to do, but not great at modifying its behaviour. If AI were human it would be best described as savant — extraordinary at solving complicated mathematical problems, but would struggle with simple everyday tasks like holding meaningful conversation. AI has its limits but it’s current detection and prediction capabilities are already good enough to make us rethink how we run our businesses and cities. The business of prediction, created by combining data with powerful computing, offers compelling benefits for many sectors — real estate included.”
The real estate industry’s reputation as being slow to innovate presents a real challenge, although Dubai is committed to fast track the process, says Al Burai. “Globally, real estate has been one of the slowest industries to innovate, but there’s no reason why Dubai can’t buck that trend,” he says. “When we launched the first Gulf Real Estate Awards in Dubai, we researched over 300 industry professionals on where they saw the biggest growth opportunities — innovation was number one. Interestingly, of all the Gulf countries, the UAE was the only one not to cite innovation as a top three challenge. We’ve just launched the second edition of the Gulf Real Estate Awards, so we’re confident we’ll be celebrating some genuine innovations in real estate that will make the region more attractive to foreign investors.”
