Adoption of Artificial Intelligence (AI) in Real Estate Valuation Practice in Lagos, Nigeria

The market value of real estate assetsis one of the major determinants influencing real estate investment decisions in the property market, and it can only be accurately ascertained through a property valuation exercise. The correctness of the valuation reports is often informed by a number of factors which often affect the valuation accuracy, if not properly managed. However, given investors increasing sophistication, the demand for high level valuation accuracy, and the potential of artificial intelligence (AI) in achieving high level valuation accuracy, the need to integrate AI into property valuation practice comes to the fore. While many professions have embraced AI, it seems that real estate sector, especially in most emerging markets, has been slow to integrate AI into property valuation practice. This study evaluated the real estate professionals' profiles, their knowledge of and willingness to use AI valuation tools, as well as the level of adoption of AI in the property valuation practice in Lagos, Nigeria. Interviews with registered estate surveyors and valuers working in Lagos real estate market—the country's commercial hub—were used to analyze the study qualitatively. It was discovered that real estate professionals have generally low levels of awareness, which means that adoption of the AI valuation model is below average. However, the readiness to embrace AI in valuation is above average. The study suggests that professional regulatory bodies and other stakeholders at all levels should establish supportive framework towards integrating AI into valuation practice. Also, real estate professional bodies should regularly conduct adequate sensitization on the accruable benefits of integrating AI valuation tools into real estate valuation practice. This will minimize valuation inaccuracy and provide easy access to market data when carrying out valuation exercises. Finally, government should provide a framework that is conducive for appropriate execution and promote sustainable smart cities in Nigeria.