How AI will change measuring the liquidity of real estate?

fintechnewsThis post was originally published by at Fintech News


Fincase creates unique IT solutions in the real estate industry that allow you to fully optimize and automate the entire cycle of working with property. The company is using artificial intelligence and machine learning algorithms to transform the real estate appraisal market.

The uniqueness of the company is in the creation of an approach to finding special solution for each partner. We do not come with a finished product, but create it together – applying the accumulated experience, and jointly identifying and solving problems.

Fincase has been operating in PropTech sector since 2016. The first project consisted in creating a system that allowed to automatically calculate the cost of commercial real estate and verify the reports of the evaluation, which provided company specialized in appraisal practice. Thus innovative product was born called the Scoring Analysis of Value (SAV), which was awarded in the start-up competition in Vienna in 2018. By 2020, SAV has been used by leading Russian market players: the major constructor companies, the government structures and the largest corporations and banks.

Based on the basic product which has proved its effectiveness in various fields, including finance sector, we decided to move on and develop on the basis of previously established mathematical model and the collected database.

New service “Fund”

Investors evaluate real estate according to two main criteria: good profitability and high liquidity. And if profitability allows you to make money in the process of owning an asset, then liquidity determines how successful the exit from an investment project will be. When measuring liquidity you need to take into account location, market state, characteristics of the building, and many other factors. Due to the high risks associated with real estate transactions, it is more reasonable to carry out an automated assessment of all indicators, which eliminates the possibility of error due to the human factor and increases accuracy through the use of data analysis technology.

The new solution of FinCase ” FOND ” is applicable to all areas of business related to real estate transactions (banks, investment holdings, real estate agencies, etc).

The “FOND” allows to analyze and determine the potential value of the collateral object to the current date and in the future, to control the timing of exposure. In other words, it lets you control the amount of the collateral mass, taking the right strategic decision in respect of each facility.

How does it work?

A User enters into the system characteristics of pledged real estate. On average, the process takes 3 minutes. Convenient visualization allows you to see a map with analogs in close proximity and, if necessary, make a comparison to them. The system is integrated with SVA and allows to compare the value of the real estate item with market propositions from public sources.

Module FOND uses neural network and calculates the level ratio (in percent) and duration of collateral object exposure as well as possible deviation. The service limits the cost potential in the context of a given time period (from six months to 5 years), taking into account the development of infrastructure around the facility and its most efficient use. You can

independently choose the exposure period or cost, thereby determining the scenario and conditions for the sale of the object. The system also suggests an “expert opinion” built on the basis of artificial intelligence, thereby showing the best implementation option.

FOND allows you to quickly obtain information about the rental rate of property item, taking into account analogues. Built-in calculator estimates payback and prevents from changes of payback period in the case of infrastructure changes. It also offers the most efficient use of collateral based on the analysis and research.

The ability of the FOND system to calculate the liquidity potential of the collateral in the implementation of transactions and making positive decisions in relation to the collateral object can simplify the work of the collateral service and reduce management risks.

Fincase team has created a disruprtive product that will provide users with the most accurate information about the situation on the real estate market and investment attractiveness.

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This post was originally published by at Fintech News

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