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Can AI Revolutionize the Real Estate Industry?

Matt Myre
3 min read
Can AI Revolutionize the Real Estate Industry?

From Elon Musk to real estate experts, artificial intelligence (AI) is the perceived backbone for the future of our economy and way of life.

We’ve seen the great things that AI has brought, including major healthcare accomplishments. But we’ve also heard the Luddite responses forecasting an eventual turn for the worst: Terminator-type destruction, shrinking job markets, and human inferiority.

If we push aside the theatrics and take a hard look at AI and its development, there are some fantastic augmentations that it’s provided to various industries, including real estate. But there is genuine concern for whether or not AI will eventually replace professionals in their respective positions.

The latest development in the real estate world is the use of AI to write listing descriptions—a job that is typically left up to the real estate agent… now taken by a new employee.

Can AI technology write better descriptions than humans?

Listing AI, a Canadian startup, is using cutting-edge artificial intelligence to generate full-fledged listing descriptions with just a few minor inputs from the user.

If you’ve ever bought or invested in a property, then you might have noticed how flat-out terrible some listing descriptions are. They don’t capture the essence of the home or market it in any fashionable way.

Listing AI co-founders Mustafa Al-Hayali and Corey Pollock started the firm for that reason.

Listing AI enhances the property description process by asking for the home’s primary data, such as square footage and architectural details. It then pushes all that information into an AI model called GPT-3, developed by OpenAI, and generates a description.

At the end of the day, the real estate agent still has to take an active role in the process. The technology can’t find any information on its own. But according to Al-Hayali, that was always the intention.

“I don’t believe it’s meant to replace a person when it comes to completing a task, but it’s supposed to make their job a whole lot easier,” Al-Hayali told CNN in a recent interview. “It can generate ideas you can use.”

Listing AI isn’t supposed to remove the agent from the description. Instead, it does 90% of the work so that they can move on to better things.

In that case, this gets passing marks. Even though the software isn’t totally finished (there are still a few kinks in language output), it does a relatively good job at what it’s supposed to do.

It’s affordable as well. As of now, there’s a free trial that includes several listing generations. If you like it, then you can buy a monthly subscription for $9 per month or $84 per year. These prices are subject to change in the future.

How will AI impact real estate?

As previously stated, AI is a great augmenter, meaning it’s good at improving workflows and doing the “silly” tasks that slow us down. But when does AI become negative?

It’s hard to pinpoint. In real estate, we’ve already seen companies put up huge sums of money to improve their AI and digital technologies. For example, Wells Fargo spent $500 million on improving its digital mortgage process.

SoFi has made it possible for the entire mortgage origination process to be fully automated. Homebuyers no longer have to pick up the phone for a consultation with a loan officer. They can get financing autonomously.

Plus, SoFi no longer originates loans using FICO. Instead, internal algorithms and AI technology have paved the way for instant qualifications on whether someone is deemed a “safe investment” or not.

Sounds great and all, but what do we lose when we give so much of the human aspect away in exchange for productivity and higher profit margins? For one, social interaction. And two—trust.

Human connections have built the most successful businesses. In an industry as personal and high stakes as real estate, you would think that a reliance on technology, namely AI technology, would be counterintuitive.

Buyers want reassurance about what they’re buying. Sellers want to know they’re getting the most value out of their home. An agent telling a seller, “Don’t worry, my robot will cover the sale” might not ease their nerves.

There’s evidence behind this as well. Statistics suggest that the Millennial cohort, a generation that grew up with computers, relies on real estate agents at an increased rate than the industry’s average.

Why? They need help understanding the purchasing process, negotiating, and making sure they’re getting a good deal. That sort of value is irreplaceable. AI will never match the power of human connection and understanding. But it can certainly make our work easier and more manageable.

That’s why we should welcome responsible technologies like Listing AI, where agent input in order to work its magic.

Unventured territory can be frightening

The imagery of AI is conflicting. On one hand, we have the Terminator and Will Smith fighting dozens of intelligent robots who have taken over society. On the other, we have the real world, where AI is being actively developed to make our lives easier and more sustainable.

There are legitimate qualms about the progress of AI and underground projects that have the potential to cause mass hysteria and real economic dysfunction.

But for now, we should relish in the fact that we can write better listing descriptions without actually writing them.

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Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.