Artificial intelligence is rapidly making inroads in every industry. A compound annual growth rate of nearly 40% is only possible because industries like homebuilding benefit from its nuances. Generally speaking, homebuilder AI is a complicated topic to discuss because it touches everything from demand planning to construction and sales. But precisely because of this broad cross-section, this technology also comes with immense potential–to the point where according to some experts, AI is poised to disrupt the entire construction and homebuilding industry.
Already, 92% of construction companies either use or intend to use artificial intelligence. Keep reading to learn about the nuances of AI in homebuilding, from its definition and benefits to how it affects daily and strategic operations.
What is Homebuilder AI?
Put simply, homebuilder AI describes any technology that uses artificial intelligence to improve business operations. With artificial intelligence as the process of simulating typically human processes through computer systems, homebuilder AI describes a self-optimizing tool that doesn’t just follow pre-established human commands but can self-optimize and improve over time based on tangible data.
Take machine learning, one of the most basic examples of AI, as an example. In a homebuilding context, a machine learning algorithm may use market inputs to forecast demand for new homes in a specific area. Over time, as the algorithm compares true demand with its predictions, it can use the additional data to improve the accuracy of future predictions.
What Makes Homebuilder AI an Effective Tool?
While homebuilder AI is still expanding and refining its potential uses, some benefits of leveraging this technology have already become clear. These benefits include:
- Scalable efficiency. At its core, AI automates tasks that previously depended on manual work. A complex demand analysis, repeated answers to common questions, and even designing components of new homes depending on local regulations and guidelines can all be automated faster and at scale.
- Improved decision-making. While data-informed decision-making has long been a staple in the homebuilding industry, the human capacity to intake and analyze data will always be limited. There are no limits to the amount of data inputs a good AI model can use for its outputs, allowing for more thorough analysis that leads to better business decisions.
- Automated personalization. Especially conversational AI can be a boon for customer relationship management, providing the ability to create personalized interactions and recommendations based on existing customer data as well as in-the-moment inputs.
- Constant availability. Speaking of conversational AI: when the technology is used in chatbots or AI-based texting, it works around the clock, every day of the year. Potential and current homebuyers can get instant answers to their most pressing questions, helping them move through the customer journey.
Of course, realizing these benefits is not automatic. Even the best AI model is only as good as the quality of the data from which it works. It’s also vital to keep in mind that, despite these benefits, the human touch still remains an important component of the homebuyer’s customer journey. After all, nearly 90% of consumers still want to talk to a human, especially when making complex purchases.
How Homebuilder AI Can Create Business Efficiencies
Because homebuilder AI is built on automated data analysis at its core, its ability to create business efficiencies is undeniable. It automates previously manual processes, freeing employees and leaders for more strategic and impactful tasks. It also provides more comprehensive reports, allowing for better decisions for the organization’s future.
The result is doing more, but more importantly, doing better, with less. At their best, self-optimizing AI processes are more consistent, accurate, comprehensive, and faster than their human counterparts.
How To Leverage Artificial Intelligence in Homebuilding
Using AI in homebuilding has to begin at the top. As business leader Jenny Dearborn puts it,
“For companies to continue to succeed, in homebuilding as in every other sector, jobs will change, and it’s up to leaders to prepare and shape their organizations to transform at every level of the value chain for AI, automation, robotics, machine learning….Leadership needs to learn, adapt, and show people in their firms and outside where the pathway forward is.”
But even with top-level support, AI-driven transformation doesn’t happen automatically. Instead, it’s about finding inefficiencies in your current work processes, looking for AI solutions that could reduce or eliminate them, and then strategically implementing solutions while closely monitoring the initial success.
To get there, it pays to understand the different ways in which AI is currently impacting the homebuilding industry.
4 Types of AI for Homebuilders
Artificial intelligence is such a complex concept that, depending on the industry, its implementation can look very different. For the homebuilding industry, four types of AI have become particularly relevant in recent years.
1. Predictive Analytics and Demand Prediction
Perhaps the most ubiquitous application of AI across industries has been in the predictive analytics space. As it applies to the homebuilding industry, predictive analytics can be especially beneficial in a few areas:
- Using market inputs, like recent buying trends and economic metrics, to forecast market demand for individual geographic areas.
- Analyzing buyer behaviors to predict preferred home features and nuances, which can play directly into new construction planning.
- Leveraging supply chain and materials analytics to understand future construction capacities better and plan around potential shortages.
Through machine learning algorithms, predictive analytics improve in accuracy over time. As a result, decisions at every strategic level of building homes become more data-informed and more likely to lead to business growth and success.
2. Design Algorithms and Machine Learning
AI design models have entered the construction industry, and their benefits apply to homebuilders as well. More specifically, advanced data models can use inputs like building codes, homebuyer preferences, and limitations like plumbing hookups to mock-up designs ranging from individual rooms to entire floorplans.
Especially for large homebuilders looking to streamline the design process, the efficiency savings will be significant. Continued use will improve the system, increasingly focusing on the designs and combinations most popular among homebuyers. Easier and earlier models of the design also increase the buyers’ ability to visualize their future home, ultimately increasing their likelihood of following through with a purchase.
3. Construction Safety AI
In the course of the actual construction, AI can continue to play an important role. As one construction industry periodical emphasizes,
“By utilizing various forms of AI – from machine learning to deep learning and more – we can empower construction companies to identify risks quickly and accurately, monitor progress in real-time, recognize potential hazards before they become serious issues, and make informed decisions about how best to resolve any problems that arise during the process.”
The ability to monitor new home construction sites allows AI systems to detect potential safety hazards, provide safety training, and track productivity. The resulting improvements in construction site safety benefit everyone involved.
4. Conversational AI
Finally, artificial intelligence can also impact the customer experience through conversational AI, which describes automated systems that emulate the experience of chatting with a real-life person. These AI-enabled digital assistants and chatbots can drive positive engagements on your website, SMS texting, and even social media.
Conversational AI initially depends on a database of pre-set answers to common questions. With every interaction, its backend algorithm learns, increasing the number of questions it can answer along with the accuracy, comprehensiveness, and linguistic nuances of those answers. As a result, it can significantly impact the customer journey from both a marketing and sales perspective.
How Marketing Professionals Use AI in Homebuilding
Above all, artificial intelligence in homebuilder marketing finds its role in personalization. Especially through conversational AI, homebuilders can automate early communications with potential homebuyers while keeping those communications at an intimate, customized level.
That might present itself as intelligent algorithms that change web content depending on the visitor. It might be push notifications sent dynamically to app users who fulfill certain criteria or exhibit certain behaviors. But most commonly, it comes in the form of chatbots.
Consider, for example, the potential of a chatbot to appear when a potential homebuyer visits your website. The buyer gets initial questions answered, piquing their interest. But the digital assistant also captures the conversation, creating a lead for marketing follow-ups.
How Sales Professionals Use AI in Homebuilding
Once the chatbot generates a lead, sales processes begin to enter the equation. Targeted outreach to interested buyers, via texting and other channels, now becomes possible. And because that nurturing process is more personalized and targeted, digital assistants like AtlasRTX generate 50% shorter sales cycles while generating 46% more leads compared to non-automated live chat alternatives.
Of course, predictive analytics remain crucial in the sales process, as well. The ability to forecast sales or affinity for individual messaging can improve sales strategy and execution. The result is a smarter sales process designed to maximize conversions and increase closed deals among potential homebuyers.
Final Thoughts on Homebuilder AI
Artificial intelligence is entering the homebuying industry with a fury that’s unmatched by most other technologies. Technologies like conversational AI and predictive analytics are already changing how homebuilders look to attract potential buyers and forecast anything from sales to market demand. Future opportunities, from AI-optimized designs to construction safety, will only enhance that potential.
To get there, you need the right tools in place. An AI-enabled chatbot is a great place to start. Discover how AI can grow your homebuilding business with a chatbot solution like AtlasRTX.