LAS VEGAS — Artificial intelligence will play a greater role in helping consumers buy and sell homes as it moves from behind the scenes to front and center in a slew of areas, according to members of a panel at the annual conference of the National Association of Real Estate Editors in Las Vegas.
Zillow, the nation’s largest real estate portal, was launched offer searches in “natural language”. on its mobile app to display more accurate results. Instead of setting up filters based on a limited number of criteria, such as the number of bedrooms and zip code, consumers can speak or type what they want.
For example, a consumer might search for a three-bedroom house with a 1950s or 1960s brick exterior with a large backyard near a public park in Denver.
“Artificial intelligence will be a huge benefit to the real estate industry,” Jasjeet Thind, senior vice president of AI and Analytics at Zillow, said Wednesday.
Since 2006, Zillow has been using machine learning and artificial intelligence in its Zestimates, automated estimates of a home’s value, Jasjeet said. Initial efforts generated a pricing error of 14%, but that has now dropped to 2%.
The use of AI has spread to numerous other applications. The pandemic popularized 3D shows, allowing consumers to take virtual tours of a home online. Zillow takes things a step further and uses AI to create floor plans and square footage estimates for each room based on photos.
AI will also enable real estate sites to connect with buyers and sellers of homes before they’re ready to talk to a real estate agent, answer their questions and increase their comfort level, said Rob Barber, CEO of ATTOM, which uses large datasets. about real estate maintains markets.
He also sees it being used more and more to show consumers what a particular room could look like with new furniture or other appliances.
ATTOM uses artificial intelligence to generate risk estimates for insurers and lenders, which in turn can help generate more tailored insurance premiums, Barber said.
The panelists said AI is unlikely to eliminate the need for human brokers or the commissions they charge, which can be in the 5% to 6% range for a seller.
But they can reduce friction or bottlenecks in real estate transactions, which is a good thing, said William Holmes, chief of agencies at Opendoor, an instant listings provider.
Although AI is making great strides, it is far from foolproof.
“AI is like an idiot savant. It doesn’t know the truth,” Glenn Phillips, CEO of Lake Homes Realty, said in another panel Tuesday.
The models remain highly suggestive and will perpetuate the biases of the coders. Bad data results in bad answers. And AI remains prone to hallucinations, or made-up answers, that sound plausible but have no basis in reality.
And even when AI works properly, natural language searches still rely heavily on how well-written searches are.
“You’re not being replaced by AI,” Phillips said. “You will be replaced by people who are better at using AI than you are.”
Get more real estate and business news by signing up for our weekly newsletter, On the Block.
