Artificial Intelligence is taking off several times faster than the internet and cell phones. Today, we will discuss the international real estate market and AI and how to use it. This will be a detailed analysis of the topic.
Five short theses on how AI will impact real estate in https://buy-dubai.ae/properties-for-sale/nikki-beach–rosso-bay-residences and all of us:
- There will be a redistribution of 1 trillion dollars of investment between cities. Over the next +-5 years.
- 30%+ of realtors will change jobs.
- 100+ million people may change their residence.
- Companies that do AI in real estate will be worth $100 billion or more in 10 years.
- There will be thousands of new-dollar millionaires.
The real estate market is slow, especially compared to the stock market. Not only is it slow, but it is also relatively predictable. For example, changes in mortgage rates or economic crises usually affect demand within 1-2 months.
That said, during crises, mainly in developing countries, there is a tendency to buy real estate as a protective tool to preserve capital (i.e., in the first stage of a crisis, real estate sales do not fall but skyrocket). In contrast, price changes in the real estate market after a drop in demand appear within 4-6 months (in developing countries, take Russia and Argentina) and 2 to 3 months in developed markets (e.g., the U.S. due to greater transparency, the market reaction is faster to changes), while in the stock market quotes can change by 50% in one day.
By analyzing changes in demand for real estate, you can accurately forecast price movements in the real estate market for the next 4-6 months. If you are ahead of the rest of the market, it is almost impossible to lose: during the crisis, you will need to be the first to sell the property, even at a discount, and at the beginning of market growth – to understand it before the rest.
This “GAP” can be verified by comparing real estate price charts around town with sudden shifts in mortgage speeds or changes in the stock market. The slowness of the entire market delivers an edge to those who react quickly during a crisis. The key question is: How do you figure out what happens before the rest of us?
Most property owners are persuaded that real estate values are always increasing, and a strong emotional attachment backs this confidence.
The emotional attachment to real estate is reinforced by important life events and the fact that people spend more than 50% of their time in residential properties. This emotional attachment and the belief that real estate values are constantly rising make the market resilient to severe price fluctuations. Rarely do real estate prices drop by more than 30% in a single year due to the limited supply in the market keeping it stable.
Conclusion
While no exact data is available, a general analysis of the various factors suggests a certain logic. When looking at the total number of millionaires worldwide, real estate is probably the area that has spawned the most dollar millionaires compared to any other industry or asset type. Why? Real estate is the largest asset in the world, and its use is widespread among all segments of the population.
Unlike the internet, which is used by almost 95% of the world’s population, real estate is used by everyone, making it a unique and comprehensive asset. A person who wants to make millions of dollars is more likely to make them in the real estate market than in stocks, business, or any other field.
At the moment, AI is really useful in real estate.
