Blockchain is moving in on real estate’s turf, reports Financial Post, and the industry stands to gain in efficiency and risk mitigation.
As a secure distributed ledger, blockchain could act as a “building passport,” providing access to information about that building that owners, occupants and other interested parties what would to know from structural details to latest renovations, says Jan Veuger.
Regression-based statistical models and algorithms have dominated in determining valuation for decades, a shift from error- and bias-prone humans. Experts predict the next technological progression will be machine learning algorithms such as artificial neural networks (ANN) and support vector machines (SVM).
Recent research shows that machine learning algorithms as superior for predictive analytics, compared to traditional regression type models.
This leap in computing is likely to benefit public sector entities, particularly those who determine property taxes, and as well as other users of mass valuation models. Mortgage lenders are another cohort who would look to benefit from these technologies as assessing value correctly is crucial to mitigating risk when extending loans.
Recent research shows that machine learning algorithms as superior for predictive analytics, compared to traditional regression type models.
Startups throughout North America are racing to raise capital in hopes of carving a slice of the real estate automation valuation market. In order to deliver their promise of accuracy, algorithms are only part of the equation. The other half needed is quality data.
The New Radicals once sang, you only get what you give. The same can be said about AI and machine learning models. Without the proper data for training, algorithms go haywire and deliver spotty forecasts. Predictive modeling runs on outlier- and error-free data, and this need for secure information is what makes blockchain and AI such complementary technologies.
What remains unanswered, notes Financial Post, are whether emotional intelligence will be a factor in real estate with the move towards artificial intelligence, and whether the absence of emotions in AI valuations will result in variance between estimates from humans and computers.