How AI & Chat GPT are Changing Real Estate
A realistic perspective on the impact on Appraisers, Agents, and Inspectors.
T - TECHNICAL SKILLS, CREATIVE ARTS, STEM
As an AI and Real Estate expert, I've witnessed first-hand the transformative power of technology across diverse sectors, from agriculture to manufacturing. Our proud traditions have always found a way to adapt and harness the potential of new tools to improve lives. Now, it seems we're on the brink of another significant metamorphosis, this time with the real estate landscape, spurred on by the emergence of AI technologies like chatGPT. Change is the only constant in life, and as we've done before, we adapt and use it to our advantage. The key is understanding the benefits, risks, and implications it brings with it.
The impact of AI on real estate agents, appraisers, and even inspectors is still an evolving narrative, but certain benefits and dangers are already starting to materialize. Let's delve into how chatGPT and AI, in general, are recalibrating the industry, as well as ponder on the potential outcomes.
Firstly, we should examine some of the potential advantages chatGPT brings to the table for real estate agents and appraisers. The most apparent advantage is the boon of efficiency and time-saving. Automating routine tasks like scheduling appointments or sending follow-ups can free up agents and appraisers to concentrate on the more personal aspects of their work - relationship-building with clients or performing detailed property analyses. It is also extremely useful in generating well-written marketing information for agents and assessing commentary for appraisers. Automation doesn't have to replace us; it can free us to do what we do best - build relationships, strategize, innovate, and make ethical decisions. It will, however, significantly shift what our actual roles are.
Another significant benefit of chatGPT lies in its capacity to process and analyze voluminous amounts of data accurately and swiftly. This can be a game-changer for appraisers who need to account for a multitude of factors when assessing a property's value. I see this affecting mass appraisal in a powerful way, but governments tend to be much slower than corporations at implementing innovative technologies. I think the development of AI tools for lender analysis at the C-suite level will be the grounds for a perspective shift that affects independent fee appraisers. And for agents, personalized recommendations based on clients' preferences, budgets, and other factors can elevate client relationships and experiences. For them, the real benefit will be the ability to connect on a personal level by reaching out to responsive clients on a large scale, then using soft skills to do what AI can't...yet.
But, as with any powerful tool, there are potential pitfalls and dangers. The fear that AI could eventually replace human agents and appraisers is a valid concern. As automation increases, the necessity for human intervention may dwindle, making some feel as though their skills might become obsolete. AI is a double-edged sword. It can enhance our abilities, but it can also make us question our relevance.
Another worry is that AI, relying heavily on historical data, might perpetuate the current biases and inequalities prevalent in the real estate market. This could result in unfair outcomes for specific demographic groups like minorities or low-income families. It could also do the opposite and create a levelizing affect similar to that in mass appraisal that causes lower income buyers to pay more for homes while under-valuing others and negating profit potentials.
Looking to the future, it's likely that the integration of AI tools like chatGPT in real estate will keep increasing, especially in the short term. Soon, we will see even more specialized AI tools tailor-made for the real estate industry, as well as a rise in the use of chatbots for improved communication between agents and clients. In the longer term, the landscape of the real estate industry might undergo a radical shift, with human roles evolving from performing mundane tasks to offering more personalized, strategic advice to clients. This could lead to a fairer, more transparent real estate market, where AI helps eliminate bias and furnish better information to buyers and sellers. Yet, as we have seen, AI has inherent biases that its developers have, both consciously and intentionally, as well as, unconscious biases. Chat GPT has shown a strong left-leaning tendency and oftentimes doesn't view conservative perspectives as valid, even when shown data that disproves its biases. Will larger-scale AI systems designed for real estate professionals have this? Yes, of course, it will.
However, the upcoming decade also brings other challenges. Potential AI-driven displacement of traditional roles could leave some agents and appraisers struggling to stay relevant. Also, ethical and regulatory issues could arise as AI tools become more sophisticated and ingrained in the industry. The future isn't written in stone. It's a series of possibilities, some more likely than others. And each comes with its own set of opportunities and challenges.
ChatGPT and similar AI technologies possess the potential to significantly change the real estate industry, offering benefits such as heightened efficiency, accuracy, and personalization. Nevertheless, these technologies are not without their risks, including displacement of human roles and potential exacerbation of market inequalities. As we move forward, it's vital for real estate professionals to stay informed about the latest AI tools and learn how to integrate them into their work, leveraging AI technologies like chatGPT to create a more efficient, transparent, and equitable real estate market for all. But take note here; AI is simply trying to complete a task and it doesn't actually understand ethics or morality. It will often claim to, but only if the position is ethically in line with the developers who collected the training data and trained it to operate. What about those who disagree with those fundamental ethical parameters? Surely you've never met anyone who had a different opinion on an ethical issue, right?
One of the biggest issues with AI is that no person or company can actually predict what it will be able to do in a year or 10 years. It could be a Matrix / Skynet situation, and I'm not joking. It could be the tool that makes all life on Earth infinitely better. I would add though, that anyone with 10+ years to go in the industry start learning AI, deep learning, and SQL because you are going to absolutely have to be able to "tell" the digital minds what you need them to do for you on a level that the average person can't or you (we) won't be needed for anything. We are still at the phase where weak AI is the norm, but strong AI is quickly approaching. The singularity is nigh...probably. The interfaces seem straight forward and prompt engineering can take you a long way, it has me for sure, but it still has limitations.
I can see a world where the building plans will be mandatorily uploaded to a government database and will be the sketch, so no need to walk around another house. The drones will do the measuring for the rest, or anything that changes, and will verify the plans are correct to an acceptable degree of variance. 3rd party inspectors and drones take the exterior photos. Homeowners will be allowed to take interior photos via permission from the lender, or MLS and County photos will be acceptable. The AI will analyze every market in the entire US and make "irrefutable" sales, cost, and income conclusions, and the appraiser will become the "Valuation Engineer" that directs and oversees, and approves the reports (at best). You'll have to be able to detect where its math or commentary went wrong when others can't. For agents, you'll have a new lockbock that analyzes through facial recognition software, fingerprints, and ID scans. If you want to look at homes, you'll setup this ahead of time at a broker's office or online and it will then be accepted once your background check is approved. All scheduling will be online and conversations will be virtual. Most homes won't need an appraisal in the future so you should be able to close within 48 hours of seeing a home. For inspectors, once the data and the process gets accurate enough to satisfy upcoming generations, home repair warranties and insurance packages will become more common and more people will opt out of the home inspection because their secondary repair policy will protect them. Also, it appears there will be a growing need for those who can discern the limits of data-driven decision-making and ethical and compassionate responses that are ACTUALLY the right course of action. NO matter how our careers and outlooks change, ethics will always be a relevant aspect of work and life. All of this is already happening in some places. Well, anyway, this is just one person's opinion.