Can AI Help You Find and Buy a Home?
By: Hannah Gable, Director of Strategy and Operations
The Changing Landscape of Home Buying and Selling
The process for buying and selling homes is changing – with the outcome of the National Association of Realtors (NAR) lawsuit in March 2024 and the rise of artificial intelligence, there has been significant startup activity in this space in the last few years.
AI-Powered Tools for Housing Affordability and Search
Flyhomes built an AI search engine allowing users to search for areas that fit their unique needs, like “is this neighborhood family-friendly?” and “is there high seismic risk in this region”? Services like TurboHome and ReAlpha offer tech-enabled brokerage services, increasing efficiency and reducing costs for prospective buyers. Once a customer finds a home, Home Lending Pal and Tomo help buyers evaluate and select a mortgage.
Zillow and Redfin: Integrating AI in the Homebuying Process
Zillow and Redfin are also integrating AI into the user experiences. Similar to Flyhomes’ search functionality, Zillow launched a search feature that uses natural language processing (NLP) and provides customers more flexibility in how they search for homes. Instead of toggling the filters, users can use conversational, simple prompts like “show me Austin homes under $400,000”.
Similarly, Redfin unveiled an AI-powered virtual assistant, “Ask Redfin” and an AI-powered home design tool, “Redfin Redesign” in early 2024.
Risks and Challenges in Using AI for Housing and Construction
As AI continues to be applied to more use cases in real estate, there is added risk. In the examples mentioned above, the primary risk is data integrity and accuracy. The quality of a model’s outputs is contingent upon how complete, accurate, and consistent the data inputs are. As AI is used in a decision-making capacity, there is also a risk the models perpetuate or amplify existing biases.
The Future of Technology in Housing and Homebuying
Risks aside, how big of a role can, should, and will technology play in helping buyers make the biggest purchase of their lives? It’s no surprise the process of purchasing and selling a home is more reliant on human and often in-person interaction than other transactions. As AI gets smarter, faster, and more sophisticated, how will human behavior and attitudes towards homebuying evolve alongside it?