What Is Predictive Analytics?
Predictive analytics is directly related to traditional real estate analytics, so let’s start out with this one. Traditional analytics is how the world of real estate used to work. Traditional analytics is used to analyze big data and show how we arrived at where we are now. Traditional analytics is great because it explains why and how life is the way it is. For example, if you have an excellent investment property which made you $50,000 in profit over the past 3 years, traditional analytics can show you what exactly led to this great success.
However, a forward-looking real estate investor wants to know how to buy the next profitable property, and that’s where predictive analytics comes into the picture.
Predictive analytics, as the name suggests, is using past and present big data to make reliable, evidence-based predictions about the future development of things.
Predictive Analytics For Builders
Real estate is a data rich industry. Over many years, we have seen more and more IDX sites integrate analytics into their listings. This benefits home buyers by providing more context about the home and its qualities. But we have not seen wide adoption of analytics to benefit builders. Predictive analytics track consumer behavior to understand the conditions in which customers are most likely to buy. This can help builders to better allocate their time and resources to maximize sales. Over the next year, we expect the use of predictive analytics in the real estate industry to accelerate.
Predictive Analytics For Buyers
For buyers, real estate investing in general is all about making informed investment decisions using solid, reliable data. The real estate business has become so competitive and technology-driven that you cannot hope to succeed as a property investor the traditional way. You have to adapt to the fast-changing investment reality and learn how to make use of the best real estate investment tools and resources.