"Out of This World Opportunity?"
The following text is Gil Castle's final draft of the real estate column appearing in Business Geographics, July 1997
Copyright © 1997 GIS
In the past, whenever I've been asked about the market potential of satellite imagery in the real estate industry, my short answer has been "tiny." That answer has been based on imagery with a resolution of ten meters or larger. Now that five meter resolution is available and one meter is resolution is forthcoming in early 1998, does my answer differ? Especially when high aerial photography is included, for example, the 40,000 scale orthophotos from the U.S. Geological Survey's NAP program? Though I wouldn't mind being proven wrong, the most optimistic answer I can now give is that the market potential in the near-term is "small."
Why? Let's stratify the various ways satellite imagery and high aerial photography might be used by brokers, developers, lenders, appraisers, property managers, buyers, sellers, investors, and the host of other professionals in the real estate industry.
Presentation Graphics. This has been and will continue to be the principal use, especially by brokers when advertising specific properties (in brochures, trade journal ads, and so on). The big problem is that when one zooms into an image close enough to see mostly a property and its immediate surroundings, any resolution greater than one meter looks fuzzy at best and like a bunch of squares at worst. The value of even one meter resolution is questionable vis-a-vis camera-ready copy for a brochure in which a multi-million dollar deal is at stake. Besides, most people would prefer an oblique, "bird's eye" view and/or a "standing on the street" horizontal elevation.
General Orientation. If I've never been to Denver and want a general sense of how the city and its surrounding communities are laid out, satellite imagery could be useful. As real estate professionals fan out through the global village, the consistency of data for not just Denver but cities half way around the world becomes particularly enticing. The counter arguments: a few oblique, birds-eye photos maybe just as good or better; conventional maps and market descriptions are sufficient; an on-site visit is going to be needed sooner or later anyway; the imagery takes up huge amounts of computer memory and disk storage, especially if five meter or higher resolution data is needed.
Time Series. Satellite imagery over several months or years can certainly highlight land use changes and help identify a pattern of urban expansion. However, most real estate professionals in an area already know about most deals even before ground-breaking; their livelihood depends on keeping current with changes in the market. Plus, a considerable amount can be learned from simply driving around, including architectural details not available from a straight down satellite image.
Backdrop to Vector Data. Placing transparent maps showing streets, demographic data by census tracts, employment data by zip code zones, property data as individual points, and other vector data on top of a satellite image can create a powerful data layering effect for analysis as well as presentation graphics. The problem this time is rectifying the vector data to the satellite imagery. Especially where the terrain is hilly, even relatively inaccurate rubber-sheeting of the vector files so that street center-lines sit directly on top of the imagery of those streets, vector files of waterfronts are aligned with the satellite version, and so on is not a simple nor inexpensive process.
More Advanced Applications. Examples of such applications include the following: (1) Invisible buttons can be embedded in a satellite image that hot link to attribute information, tables, photographs, or other data. For example, buttons can be located under each of the major office buildings appearing in a satellite image; clicking on a building in the image launches a program that causes data on that building to appear on the screen. (2) An oblique angle, birds-eye view of an area can be obtained from stereo satellite images. The first of the stereo pairs is taken when an object first appears on the horizon in front of the satellite; the second, as the object is about to disappear on the horizon behind the satellite. Especially when combined with a digital terrain model of the area's topography, three dimensional views of the area become possible. (3) Similarly, a three-dimensional, virtual reality world can be created in which viewers can "fly" across an area. Though marketable, these applications are rarely seen, again suffering from the need for sophisticated, expensive data base development work and high-powered computing capabilities at the end-user's site.
All the above is the bad news. The good news: People like photos, just as they like maps, because human beings are a highly visual species. Satellites and high aerial photography do provide a highly standardized, consistent, frequently updated source of information. And even a "small" piece of the huge real estate industry isn't bad.