How Can Predictive AI Help You Identify Motivated Sellers?

Disclaimer: This article includes fictional use-case scenarios that are designed to showcase how PropStream’s data, filters, and tools can be strategically combined to help real estate agents address unique challenges and uncover potential opportunities. PropStream does not guarantee or promise profits, outcomes, or specific results. All real estate transactions involve risk and require independent analysis and due diligence.

Even with more housing inventory, there is still a lack of real estate activity due to high interest rates and home prices.

As an agent, this can make it hard to find listings and opportunities for buyer clients. No matter the type of client you plan to work with, motivated sellers are a crucial part of the equation.

Luckily, in today’s digital age, there are more tools and resources than ever before to help you identify motivated sellers—before they’ve listed a property for sale. But the question is: How do you find these motivated sellers?

This is where predictive AI comes in. With predictive AI, agents can study potential outcomes before they happen, finding motivated sellers before competitors.

But, first, let’s back up and unpack the complex world of predictive AI. In this article, we’ll explore what predictive AI is, how it’s used in real estate, and PropStream’s predictive AI datasets that are designed to help you find leads quicker and more effectively than ever before. Let’s dive in.

What Is Predictive AI?

Predictive AI (short for predictive artificial intelligence) refers to the use of AI technologies—especially machine learning—to analyze data and forecast future outcomes or behaviors.

In simple terms, it uses patterns from past and current data to answer questions like:

• What is likely to happen next?
• Who is most likely to take a certain action?
• Where should I focus my efforts for the best results?

How Does Predictive AI Work?

Predictive AI algorithms typically follow three steps to provide you with insights.

Step 1: Data Collection

It gathers large amounts of data (for example, if you’re working with real estate data, predictive AI collects information like property history, market trends, and user behavior).

Step 2: Pattern Recognition

Using the data collected, it will identify trends and correlations using the appropriate algorithms.

Step 3: Prediction

Guided by the patterns identified by trends and correlations, it will predict future outcomes.

Predictive AI vs Generative AI: How Do They Differ?

When we hear or see the term “AI,” it can seem broad and often confusing. However, there are two main categories of artificial intelligence, each performing different functions: predictive and generative AI.

The main difference between these two forms of artificial intelligence is their purpose and process. For example, predictive AI aims to answer what will happen next based on historical information. It doesn’t create new information from scratch; it simply uses old data to predict future outcomes.

On the other hand, generative AI is responsible for creating new content. While it is often guided by previously published information using deep learning models, it can generate various kinds of new materials, such as images, emails, text messages, scripts, and more.

How Is Predictive AI Used in Real Estate?

As we explored above, predictive AI examines historical trends or data to make predictions about the future.

In real estate, this can be useful for understanding trends or situations before they happen, allowing professionals to make quicker decisions and seize opportunities before competitors.

PropStream’s Predictive AI and What It Offers: PropStream Intelligence™

Now that we know predictive AI’s vital role in the real estate world, let’s explore PropStream’s predictive AI capabilities, which are available with PropStream Intelligence.

Predicting Which Properties Are At the Highest Risk of Foreclosure (Or the Lowest Risk)

The Foreclosure Factor data uses multiple data sources and AI algorithms to assign a propensity score to mortgaged properties, estimating their likelihood of entering default. Scores range from Very Low to Very High, with higher scores indicating a greater chance of foreclosure within the next 12 months.

Determining Property Condition by Scanning MLS Photos

With PropStream Intelligence, Property Condition is determined using an AI algorithm that analyzes MLS photo data to assess both the overall quality of the home and specific areas such as the Exterior, Interior, Kitchen, and Bathroom. Properties are rated on a scale ranging from Disrepair (lowest) to Luxury (highest).

For real estate pros pursuing a specific type of property, this feature saves hours of time they’d otherwise have to spend sorting through photos themselves.

Wholesale Value Calculation

Wholesale Value uses a machine-learning AVM algorithm to provide a fast, reliable property price estimate—calculated at 70% of the AI-generated estimated value. This streamlined approach empowers wholesalers to identify strong deals and maximize potential returns.

Sample Listing Client Personas Agents Can Find Using PropStream Intelligence Filters (and How)

Important Note: Before pursuing off-market leads to list, we recommend understanding NAR’s Clear Cooperation Policy to ensure compliance.

We’ve explored what PropStream’s predictive AI datasets are. In this section, we’ll apply them to sample use case scenarios to show how they can help agents identify selling potential in their local markets.

Pro Tip: (*) Indicates a dataset is powered by predictive AI.

Selling Motivations

• Physical limitations are making the property with multiple stories and a large yard too difficult to maintain.
• Younger families are moving into the neighborhood, leaving the Williams’ with fewer neighbors they have things in common with.
• Their home is free & clear as they bought it 50 years ago. However, the home is in need of renovations that they do not want to perform themselves; they would rather put that money toward a down payment on a more suitable home.

Profile for The Retirees:

Sally and Dave Williams have lived in their family home for 50 years. Sally is a retired principal, and Dave is a retired teacher. Since they have lived in their home for so long, they paid it off years ago, and it has grown substantially in value over the years.

However, both Sally and Dave struggle to maintain the home and move about it freely. Unable to repeatedly go up stairs, they have made the main floor their living and sleeping space, causing half of the house to go unused. Due to their physical limitations, they have been unable to perform needed renovations, and their lawn is often overgrown and unkept.

Additionally, the neighborhood is primarily made up of younger families and their children, leaving Sally and Dave feeling that they have few commonalities with their neighbors and craving more opportunities for socialization.

Sally and Dave’s Ideal Resolution

Sally and Dave want to move to a retirement community that is mostly condos to be near people of a similar age who are also retired. This way, lawn and indoor maintenance will be taken care of for them, and they will have less space to keep tidy. Plus, they can choose a unit without stairs, making it easier for them to enjoy the whole home.

To purchase their new condo, they want to sell the home they currently live in, buy the condo in cash, and put the remaining proceeds toward savings in case they need to move into assisted living at some point.

PropStream Filters an Agent Could Use to Find The Retirees:

“Senior Owners” Lead List: This Lead List identifies homeowners who have lived in their home for 25 years or more or have a reverse mortgage, suggesting they are senior owners

Number of Stories 2+ (Under “Property Details”): Identify homes that have more than one story, which may present issues for some senior owners.

* “Disrepair” to “Average” Property Condition Filter Range: In our scenario, Dave and Sally’s home renovations have become too much, and they do not want to pay to have them done. To find homes needing work, the Property Condition dataset can be applied—stacking additional selling motivation and increasing conversion chances.

Bonus PropStream Features to Solidify Leads

Demographic Data

To determine if senior homeowners are starting to age out of their community (indicating they may want to move to an area with more people their age), study these demographic datasets:

• Employment Level: Offers insight into the concentration of employed people nearby.
• Household Composition: 3+ people may indicate there are primarily younger families in the region rather than older couples with an empty nest.
• Total Population by Age Group: Determines the most common age groups within a 0.5-mile radius.

Selling Motivations

• Dana is losing money on her property. Nobody is living in or even visiting it, and it is not generating any sort of passive income, but Dana continues to make a mortgage payment on it.
• The home's empty state has attracted squatters and vandals, causing concern for neighbors worried about criminal activity impacting their homes.
• Due to the lack of upkeep and criminal activity, the property is decreasing in condition, causing the return from a potential sale to be lower the longer Dana waits to sell.

Profile for the Vacant Vacation Homeowner

Dana Mitchell is a busy saleswoman. Her work sends her all over the country to conferences, events, and client meetings. However, she wanted to purchase a home in her favorite vacation spot to unwind during her off hours.

Due to her busy travel schedule, Dana has not found time to visit the home. She realizes she needs to sell due to her lack of availability to enjoy it, combined with the fact that she is still paying a mortgage on it in addition to her condo, which is close to her company’s main headquarters.

To make matters worse, her home has become a hotspot for squatters, vandalism, and other illegal activity, causing the value to drop and the neighbors to complain to Dana about the lack of security they now feel in their neighborhood.

Dana’s Ideal Resolution

Dana would like to work with a trusted agent who can facilitate most of the sale and communicate primarily over the phone. She wants to keep her visits to the property minimal, so she relies on an agent’s expertise. Also, she does not have the time to coordinate extensive renovations, so she needs an agent who can think creatively and work with the property as-is.

Her priorities are to sell the home quickly, avoid further depreciation, and help her neighbors maintain their property value and feeling of security by getting new owners into the home with adequate time to care for it.

Applicable PropStream Filters Agents Can Use To Find the Vacant Vacation Homeowner:

“Vacant” Lead List: Flags properties given this classification by the USPS.

* “Disrepair” to “Good” Property Condition Range: Pulls properties in need of significant renovations before it is considered ideal for a new owner.

Out of State or Out of County Absentee Owner Location (Under “Owner Information & Occupancy): This list pulls properties with an owner who does not live near the property, identifying more selling motivation.

Selling Motivations

• Unable to make mortgage payments, causing the home to enter pre-foreclosure status.
• Wants to avoid a significant credit hit from the home entering foreclosure.
• Wants to get a return from the property, as he has a decent amount of equity in it, to get something more affordable.

Profile for the Down-on-His-Luck Luxury Homeowner

Jared Greene is a seasoned entrepreneur. After working to earn a “comfortable” salary, to say the least, he decided to pull the plug on a piece of luxury real estate. He could easily afford the mortgage payments for years, even paying extra at times. However, he recently fell on hard times and found it harder and harder to make that hefty mortgage payment each month.

With no indication that his business will pick up and falling behind on his mortgage payments, his luxury home has entered pre-foreclosure.

Jared’s Ideal Resolution

While Jared has fallen behind on mortgage payments, the quality and value of his home have not suffered. Plus, when he was bringing in substantially more money, he was paying extra on his property, increasing his equity.

To avoid a larger-than-necessary credit hit and to get a return that will allow him to purchase a home with a more manageable payment, Jared wants to work with an agent who can get him the highest return possible before his home enters foreclosure.

Applicable PropStream Filters Agents Can Use To Find the Down-on-His-Luck Luxury Homeowner:

“Pre-Foreclosure” Lead List: This Lead List helps identify motivated sellers facing pre-foreclosure.

* “Excellent” to “Luxury” Property Condition Range: This range pulls properties in luxurious condition that should not need many renovations, if any.

* “Medium High” to “Very High” Foreclosure Factor Score: To find the properties at the highest risk of foreclosure, the Foreclosure Factor filter is valuable.

Pro Tip: After finding leads on PropStream, it’s easy to start a marketing campaign. Simply save your leads to a list, perform a skip trace, and call or create an email campaign.

Start Exploring PropStream’s Predictive AI Capabilities Today to Build Your Pipeline

PropStream Intelligence takes your lead generation methods to the next level, offering the ability to filter your searches and find the best leads like never before. PropStream Intelligence data (combined with our other filters and pre-built Lead List options) can help you cut through the competition and find the most motivated sellers quickly.

The opportunities are endless when you PropStream It. Activate your 7-day free trial today to begin exploring our datasets. Plus, enjoy 50 leads, on us!