Last modified on August 4th, 2021
By Marc Frenkiel
One of the more permanent changes of the past year relates to technology in the workplace. The pandemic-induced lockdowns accelerated the digital transformation of business that was already underway. Real estate is experiencing its own transformation with the growing use of artificial intelligence, especially in property management.
AppFolio conducted a study to gain a better idea of perceptions of AI in property management. We learned that many decision makers shy away from incorporating AI into their businesses due to a lack of understanding of the technology. In reality, these same people are using AI in their everyday lives without realizing it.
By enabling artificial intelligence within their workflows, property management teams can become more efficient by automating time consuming and repetitive tasks that do not necessarily benefit from a human touch. The result? Better decisions and space to focus on what really matters for your business to thrive.
You use AI daily without realizing it
When asked whether they agree with the statement, “I believe I have a basic understanding of artificial intelligence,” 85% of the property management executives, decision makers, and generalist property managers surveyed said yes.
But when asked “Have you ever used or interacted with AI-based technology,” only 32% said yes. 49% said no and 19% were unsure. What’s interesting came from a follow-up question:
Which of the following technologies do you personally use?
- Travel recommendations
- Media recommendations
- Product recommendations
- Virtual assistants
- Smart home technology
- Health and fitness insights
- Home robots
- None of the above
These are all AI-based technologies, but no one answered “none of the above.”
Clearly, artificial intelligence is not widely understood, which makes it understandable that 53% percent of survey participants believe that AI entails risk. When asked to expand, respondents told us that they believe:
- While AI could help resolve easily asked questions, giving wrong information can open the door to litigation
- Relying too much on AI can cause blind spots in the company and may cause complacency
- Provides efficiency but may lose touch with residents
In order to quell any hesitancy and show how AI is an asset rather than a liability, let’s explore the technology a bit further.
What is AI?
In its simplest terms, artificial intelligence refers to systems that imitate human intelligence to perform tasks, and can improve themselves through the constant repetition of those tasks and based on the information they gather.
The key here is “constant repetition.” It is the routine, repetitive tasks that humans don’t necessarily want to do that are ripe for AI to automate. Ultimately, AI helps quickly process and input data, learn preferences, allowing property managers to be more efficient.
AI Leasing Assistants
AI leasing assistants work 24/7 as part of the leasing team to provide instant responses to prospective renters, including nuanced answers to questions regarding units for lease and scheduling showings. Advancements in natural language processing are helping these “machines” sound more and more human while they continue to learn from every interaction to improve themselves.
Data shows that the faster a property manager or leasing assistant can reply to a prospective renter’s initial inquiry, the greater the chances of obtaining a signed lease. According to Zillow, a response in the first 1-2 minutes of receiving the inquiry leads to a 40% chance of prospect engagement. Waiting even 30 minutes to respond plummets that likelihood to 10%. A traditional leasing agent may have their hands full when an inquiry comes through, rendering them unable to provide an instant reply. AI leasing agents can handle an unlimited amount of tasks, day or night, so that your human leasing agents can focus on those human interactions that ultimately close deals, as efficiently and stress-free as possible.
AI leasing assistants leverage integrated reporting technology to track leasing performance with accurate data, helping drive occupancy and operational efficiency. Property managers benefit from robust lead to lease data and insights, ultimately enhancing, optimizing and automating the leasing flow.
Elevating the employee experience
The property management industry is experiencing a talent crisis. While the average turnover rate across all industries stands at 22%, property management suffers from a turnover rate of 32.7%.
In a Propmodo article, Grace Hill CEO Dru Armstrong explained that “many property management staff cite burnout as their primary reason for moving on. I know their complaints are valid. Property managers are asked to wear a lot of hats, all at once. They would be far less susceptible to burnout if they could only hire and retain more staff to cover the diverse range of their demanding and often essential responsibilities.”
But instead of hiring more staff, what if there was a way to incorporate technology that automates much of the “nitty gritty” in property management, freeing up existing team members’ time to focus on what they may perceive as being higher-value, or just more enjoyable. This is where artificial intelligence adds immense value.
Returning to the AppFolio study, 80% of those surveyed said that creating accounting reports should be automated, and 75% listed auditing, financial diagnostics, utility billing, and entering bills. Whether approaching this from an employee satisfaction perspective or as a way to promote efficiency, decision makers are clearly on board with automation.
How AppFolio is leading the way
AppFolio Property Manager has been selected as a winner in this year’s AI Breakthrough Awards program – taking home the “Best AI-based Solution for Real Estate” award. Combined with winning the 2020 Artificial Intelligence Excellence Award for Best Product or Service, we’re on track to becoming the leader in the space.
For a deeper dive into the coalescence of AI and property management, we invite you to check out our Top Floor episode titled AI and Real Estate: How Technology is Redefining Relationships. The episode features an interview with AI expert and AppFolio Chief Technology Officer Andrew Mutz, along with several decision makers from various property management firms across the country who speak on their real-world successes with AI property management technology. Additionally, please keep an eye out for the upcoming whitepaper detailing the results of our artificial intelligence in property management study.
But before checking out these resources, we’d like to know what aspects of property management you would like to see automated in the near term. Just leave a comment below and who knows, maybe you’ll have a hand in creating the next game changing innovation in property management.
Here’s to the future.
This is a fascinating article! We’ve been looking into similar options for our team. We’ll be keeping these in mind!