Artificial intelligence (AI) has been at the forefront of recent media coverage. Some commentators have voiced concerns about AI chatbots replacing human customer service, the possibility of widespread plagiarism, and the potential for declining Google rankings. Others are looking at the new opportunities that AI can provide. Either way, AI is here to stay and will impact all industries, including real estate.
AI can bring exciting new possibilities to your real estate brokerage to help you explore new ways of doing business. But there are potential challenges and risks that real estate brokers and licensees need to be aware of when considering using AI in your business.
What is AI?
According to the Oxford dictionary, artificial intelligence (AI) is “the theory and development of computer systems able to perform tasks normally requiring human intelligence, such as visual perception, speech recognition, decision-making, and translation”.
AI has been around for more than 70 years. The earliest successful AI program according to Britannica records was a checkers program designed by Christopher Strachey. In 1952, the program was able to play a complete game of checkers against a human player.
Nowadays, computer algorithms can scan millions of pieces of data in seconds. AI is being used in self-driving vehicles, robotic-assisted surgery, and a range of other applications. Tools like Chat GPT have been making news around the globe. AI technologies and capabilities are rapidly growing and transforming the way the world does business.
Research suggests the global AI market was valued at more than $136 billion in 2022. Projections show that this is likely to further expand at a rate of 37.3% per year during the period 2023 – 2030.
AI Opportunities in Real Estate
AI technologies and tools are developing at a rapid pace. Here’s how they can help you in your real estate business.
Prospects often have similar questions, which can be time-consuming for licensees to answer. Enter real estate chatbots — AI-powered auto-responders that can act as virtual assistants for your real estate brokerage. These chatbots can be installed on your website to respond to customer inquiries 24/7. They can capture customer information and answer FAQs, saving your licensees time and effort. The chatbot can also ask questions of prospects to help understand their needs, so you can better tailor services to what they’re looking for. Chatbots can even book property viewings if you link to your team’s calendar, so they can see what time slots are available.
Increase Efficiency and Lead Generation
AI tools, such as Localize AI Hunter, are helping brokers to streamline their lead generation processes and prioritize leads. Hunter contacts leads on behalf of licensees via text message. It can have structured one-to-one conversations — not simply form replies that are the same for everyone. The basis of Hunter’s technology is its natural language processing algorithms which mimic a person’s natural speech. This makes the communication method seem more “human” than robotic. Once a prospect is ready to inspect a property, Hunter hands it over to the licensee and provides a full report of the prospect’s preferences. Using this type of technology can result in many more leads per day being followed up than using traditional methods. It also frees up time for licensees to do more relationship building with qualified prospects, rather than being tied up with prospects that might not proceed to a property inspection.
Data-driven Decision Making
Good data is needed to make good data-driven decisions. AI Programs can help real estate professionals streamline the data analysis process, saving hours of effort that a real estate professional could use elsewhere in the business. AI tools can scan millions of files and pieces of data in just seconds. They can provide greater insights into housing market trends, property values, and patterns, than your team can produce manually. AI can look at property values, previous sales information, and potential areas for growth and produce reports that can help you to make better decisions in your business. Of course, AI is just one tool that can help with your decision-making, and human oversight is still required to look at the bigger picture.
Potential Challenges and Risks of Using AI in Your Real Estate Business
Risk #1 – AI does not always produce accurate information
While AI tools have the potential to help you in your real estate business, brokers need to be aware of the limitations. AI is not a magic bullet or panacea that can fix all problems. Yes, AI tools might help you to be more efficient in your real estate business. However, unconditional trust in AI would be misplaced at this time. For example, when it comes to AI-driven content, sometimes it may read well and seem to be accurate, but it’s not always correct information. There have been instances where AI tools have incorrectly attributed quotes to different people, or completely mixed up the facts.
Maybe one day AI will be 100% foolproof, but we’re not there yet. Real estate brokers, licensees and other human resources are still very much needed to vet information and check to ensure the accuracy of the outputs from AI programs.
Risk #2 – Potential Copyright Issues
AI programs can generate content on just about anything. Take Chat GPT as an example. This is an open access tool where people can ask questions and the program responds after scanning its database of millions of pieces of content. While it might seem advantageous to shift towards AI-drive content for property descriptions or marketing materials, you could find yourself facing a lawsuit if you’re found to be using someone else’s work. The thing about AI-driven content is that you don’t know exactly where it comes from or how much is plagiarized from another source. This opens brokers and licensees up to potential copyright issues, leading to legal problems and embarrassment for your brokerage,
Risk #3 – Search Engine Optimization (SEO) Impacts
Search engines, such as Google, still favor human-generated and original content. It’s worth putting in the effort to create individual property descriptions and content for your real estate brokerage. If you simply rely on AI-generated content, there can be negative consequences for your SEO. Google can detect AI-generated content, and it can affect your search engine rankings if you’re just copying and pasting from an AI program.
And AI or no AI, you are still responsible for the information in your listings, ads, mailers, and websites. Be sure a human reviews everything for accuracy before publishing.
Protect Your Real Estate Business
AI offers new insights and can be a valuable tool for your brokerage. However, there is no substitute for qualified and experienced real estate professionals who still need to oversee the process. When experimenting with new tools and ways of doing business, it’s important to ensure you have measures in place to protect your business.
CRES offers a range of insurance options — from real estate errors and omissions, to Business Owner Policies, to Workers Compensation, Cyber Liability, and Surety Bonds. As part of one of the largest insurance brokers in the world, we have access to more options to help protect you and your team. With CRES E&O + ClaimPrevent®, you can even get access to expert real estate attorneys pre-claim to help you prevent lawsuits. Contact us today for a confidential discussion about your insurance needs.