AI: More Than the Next Big Thing
Artificial intelligence is here to stay, but it’s not here to replace people.
It’s a tool that blends the processing power of machines with human intelligence to augment capabilities. While it’s already been deployed across many industries to increase ROI, macro use of artificial intelligence (AI) in rental housing has been limited.
During the 2021 Apartmentalize session, “AI: More Than the Next Big Thing,” industry experts discussed how employing AI as part of a revenue management strategy encourages optimization across various dimensions, including providing data on prospective resident and applicant behavior, which can further maximize asset value.
In the multifamily housing space, AI seeks to help understand more about two individual groups of people: Residents and prospective residents.
“The more we can know about those individuals and their overall behavior helps you really understand what you need to have at your communities, what type of technologies that you can use within those,” said David Polewchak, Industry Principal at RealPage. “Ultimately, AI is doing a lot of the work to help in this.”
But it’s not just the industry that needs it. Renters want it, too. Residents desire smart home technologies that keep them connected to their home, making life more efficient.
AI is used in a variety of capacities, and its presence is emerging on a daily basis. However, the true potential of this type of technology is still being explored in the rental housing industry.
“We threw a lot of technology at people last year, and we are impressed by the way that we’ve seen it evolve around digital marketing,” said Aaron Maas, Vice President of Multifamily Operations for Origin Investments. “A few years ago, it was all about aesthetics and what it looked like. Now, there's different ways to target audiences, including people who fit a renter profile and really focusing your marketing on where the renters are.”
When it comes to touring a property, the use of technology has seemingly moved to the forefront and operators should take notice.
“There’s been a lot of hesitation around more virtual leasing and the adoption of self-guided tours,” said David Danish, Senior Vice President of LivCor. “We are now the hold up, not the consumer. Us in the multifamily industry are the ones who are hesitant to rely on those, whereas potential residents are actually eager to adopt those technologies.”
With technology fueling the larger vision, data derived from AI helps monitor and measure success in ways that weren’t possible before.
“There are so many moving pieces in operations and so all of the facets come together like a well-oiled machine with AI,” Maas said.
For revenue management, data intelligence is crucial for accuracy. AI tools can look at multiple factors at once, allowing teams to access individual guest cards and prospective resident information to help forecast supply and demand.
“For us, it’s all about how far ahead of things you can get,” Danish said. “And the better sense I can get of which residents are staying and which are going, and which units I'll have available, the more I can leverage that information to market appropriately.”
AI and marketing channels provide a glimpse into the future, helping teams make better decisions and unearth opportunities to unlock more value.
According to RealPage, the average rent roll has 10% of its value associated directly with amenitization, and 60% of amenities are undervalued. Having the ability to look at data regarding amenities helps underscore the value of them and how that plays toward leasing.
AI’s future in the multifamily arena is certain to expand. As technologies progress, the industry will gain more insight into resident behaviors and illustrate macroeconomic factors such as migration patterns, showing the industry where it can improve to meet residents’ needs.
“Knowing what their preferences are, what keeps them at a community and what closes the deal is going to help us not just design better communities, but to also optimize the communities we already have,” Danish said.
Transparency and an elevated customer experience are what drive the success of the multifamily industry. AI can assist already strong team members in meeting goals and enhancing the industry at every level.
Andrew Ruhland is a Junior Account Executive and Assistant Content Writer for LinnellTaylor Marketing.