top of page

How AI is Changing Real Estate

Writer's picture: Joe FrankJoe Frank

Updated: Jan 28


The world of real estate is transforming due to Artificial Intelligence (AI). From finding the perfect home to streamlining transactions, AI is becoming a powerful tool for both buyers and sellers. But like any new technology, it comes with pros and cons.


This is an introductory overview on how AI is making waves in real estate and what it means for you.


It's important to understand that this article does not delve into all facets of AI as it relates to the real estate industry. AI capability is evolving rapidly, so what's relevant and available today, may be outdated (or much improved) 6 to 12 months from now. As a point of reference, this article was written on January 6th, 2025.



AI and Real Estate - A new future
AI and Real Estate - A new future

Real-World: How AI is Changing Real Estate


AI is no longer a futuristic idea; it’s already here and impacting the real estate market in helpful ways for buyers and sellers. Here are a few examples:


  • Personalized Home Search Platforms like Zillow, Redfin, and other home search platforms use AI to analyze your preferences and suggest homes tailored to your needs. Instead of scrolling through endless listings, AI helps you focus on properties that better match your criteria. Flyhomes.com is marketing themselves as "The worlds first AI-powered home search". However it's likely most major home online search sites are leveraging AI to some extent to improve the user search experience.


  • Market Insights Real Estate agents familiar with AI capability and tools are leveraging AI to supplement their own experience, expertise, and skill set to better predict housing market trends. This helps sellers price their homes more accurately, and buyers make more informed and competitive offers.


  • Virtual Staging Real Estate agents can offer seller clients the option to virtually stage a home. For many sellers, this can be a more efficient, convenient and cost-effective method of marketing a home, and is becoming much more common. NOTE: Any home that is virtually staged for the purposes of marketing (MLS photos, etc) should be disclosed as such. On the flip side, buyer agents can offer virtual staging so their clients can envision how a home looks with different furniture and even layouts.

    • Two popular AI powered virtual staging applications are listed below. There are many additional online tools available, and with the advancement of AI, many more to come with even more capability.


  • Smart Contracts AI is being integrated into blockchain technology to create “Smart Contracts” that simplify and secure real estate transactions. Though not common yet, Smart Contracts will become ubiquitous in the years ahead due to the speed, transparency, security, efficiency, and cost savings they can provide in real estate transactions. This article from Imenso Software provides additional insight.


  • AI Real Estate "Agents" This is an intriguing element of AI in the real estate industry, and to most real estate agents, a concerning one. Will AI Real Estate Agents one day take over the real estate industry? Perhaps, but nobody knows at this point if it will actually happen, or when. The hope of many is that AI agents will reduce commissions, and the overall cost of selling and buying homes by being much more efficient. However, it could also make the process more generic, less transparent, and more stressful for buyers and sellers. Whether buyers and sellers will get the same level of personalized service and expertise they expect and receive today with a human agent is unclear. However what is clear, is that we'll see increasing AI technology ("agents") assisting and supplementing human agents. With this evolution, real estate agents must ensure their clients continue to receive top-notch personalized service to support their unique needs and goals, and ultimately achieve the best overall value. Only time will tell what the future holds for AI and real estate. Nevertheless, buyers, sellers, real estate agents, mortgage brokers, and the entire industry should stay in lockstep with the evolution to ensure we're prepared for the changes that lie ahead, and adapt accordingly. To get a small taste of what may be more common in the future, WithJoy.ai, is a real estate company that offers the ability to buy a home with an AI agent (with human real estate agents in the background acting in a supportive role). If anyone has used WithJoy or currently using it (or any similar tools), I'd love to hear your feedback - please comment below or contact me. Thanks!



The Pros of AI in Real Estate

  • Time-Savings

    AI-enabled online home search tools empower home buyers and investors to fine tune the type of home and location (including specific criteria like school ratings, climate risks, traffic, etc). AI can quickly sift through thousands of home listings and limit endless scrolling through homes that don’t fit a buyer's budget and wish list. This in turn helps sellers find the right audience and has the potential to accelerate home sales.


  • Better Decision-Making

    AI predictive analytics and image recognition can spot economic shifts and real estate market trends. This can provide buyers and sellers an advantage in the housing market by finding better deals for buyers, and ensuring homes are priced appropriately for sellers. Tools such as HouseCanary and CoreLogic are ore oriented toward AI and market trends.

  • Improved Accessibility

    Whether it’s translating a listing into multiple languages or enabling voice search for buyers with disabilities, AI makes the market more welcoming and easier to navigate for everyone.


  • Enhanced Marketing

    From personalized ad campaigns to virtual staging (which can cost much less than the real thing), AI helps showcase a home in the best light and reach the right people at the right time.



The Cons of AI in Real Estate


  • Lack of Personal Touch AI can crunch numbers, but it can’t replicate the customer service, empathy, and skills of an experienced real estate agent. Most real estate transactions need real human insight to handle the unique situations and bumps along the way. Ideally, an experienced real estate agent is also well-versed in AI and leveraging the appropriate tools and data to assist you with buying or selling.


  • Potential Bias AI and their algorithms learn from the data they’re fed (normally a lot of online data scraped from public sources). If that data is skewed or incomplete, the AI may give recommendations that aren’t fair, appropriate, or accurate. Therefore, it's always important to review the data to ensure accuracy and relevancy.


  • Over-Reliance on Technology

    While AI is very helpful, it shouldn’t be the only factor in your decision. Relying too heavily on automated tools can mean missing important details that a human expert would catch.


  • Privacy Concerns

    Online AI tools often need personal information which can concern folks who value keeping their data and life private. Always check how your data is being used and protected. If your real estate agent is using AI tools, be sure you understand what tools, and what (if any) personal information they are feeding it.



Where I Come In


As a real estate professional (and technology geek), I’m passionate about staying on top of the latest technology, including AI, to best serve my clients.


My goal is to empower you with the knowledge and tools you need to make the best decision for your unique situation. Whether you decide to lean into AI, rely on the human touch, or some combination of both, I’m here to help and would love to discuss further!(of course no cost or obligation)


AI is an exciting new chapter in real estate, and I’m here to help you navigate it with confidence. Let’s explore the possibilities together!


Thank you for taking the time to read this article!


-Joe



Listen to the podcast for this article. Note: this podcast is AI generated from this blog article.



Comments


bottom of page