Artificial intelligence (AI) has entered the realm of residential real estate.
AI, computer systems developed to handle tasks that normally require human intelligence, are taking over real-time valuations for homes, data mining homes with specific characteristics, answering homebuyers' questions, creating marketing copy, connecting homebuyers with local real estate agents, and a whole lot more.
Officials from one company that has entered the local market making full use of the new technology say they hope to turn tears of frustration that often accompany real estate transactions into tears of joy.
Though anyone can use them, the target audience for AI online home-buying services are those in the millennial generation — 66 million Americans born between 1981 and 1996 — who now represent the largest homeowner majority. In 2022, millennials made up more than half of all homebuyers, according to a recent report from Rent Café.
Most of them grew up online and feel comfortable conducting many life experiences in virtual spaces, said Josh Ades, marketing director for DwellWell — a Los Angeles-based real estate tech start-up that uses AI software to assist clients with the home-buying process. DwellWell, which is among the AI services being used in real estate transactions in the Bay Area, provides online answers to basic home-buying questions, new homebuyer educational programs, pre-approval for mortgage loans and connections with three "best match" real estate agents working in the areas where buyers are seeking homes.
"We sincerely want to help home buyers, and what Realtors don't especially love is having to answer repetitive questions," said Ades, while explaining the many ways AI can be utilized in the home-buying process.
DwellWell's online resources for a "guided" home-buying experience -- which provide step-by-step guides on everything from home-buying basics to choosing an agent to how to close the deal -- are especially attractive to younger, tech-savvy buyers, Ades said, noting they tend to be more comfortable with conducting research and gaining access to educational resources online.
Once there, they can chat with "Dwelly," the website's mascot and navigator, to familiarize themselves with the home-buying process, determine their eligibility to qualify for mortgage loans and find a selection of suitable real estate.
What do real estate professionals think?
AI works for Realtors, too, some say. AI can definitely be employed as a useful tool to assist agents, in the view of Dave Wetzel, CEO of Sunnyvale-based MLSListings Inc., the regional property listing service.
"I absolutely feel there is value in AI for my customers," Wetzel said, referring to the nearly 17,000 real estate agents who use his service. "There are many products and services out there today that can assist my customers."
Wetzel touted the usefulness of AI: Realtors are saving time and money using AI programs to make tasks, such as loading property photos onto their websites, less labor intensive.
Room descriptions can be handled by AI software instead of agents having to do this type of relatively mundane task, he explained.
"Agents can spend more time with clients," he said.
Wetzel took issue with one of Ades's contentions that Realtors appreciate being spared repetitive questions from potential homebuyers about individual properties and the home buying process.
"They love being asked those questions," he said. "It gives them the opportunity to get to know the buyers and to display their knowledge and expertise."
AI is a rapidly developing technology with great potential in the real estate industry, Wetzel said.
In the near future, Wetzel said his organization's website will employ AI to help agents upload property photos, descriptions and community details.
He also envisions future classes to educate agents on further uses of AI to help them handle the myriad daily tasks in their individual businesses
"Whether it is social media posts or a 750-word blog, for example, AI can be used to handle writing tasks," Wetzel said.
Not everyone in the industry is quite as AI-enthusiastic. Some believe that AI-generated services and tools will never be as effective as developing in-person relationships with a human real estate agent.
"Buying a home is the largest purchase most people ever make in their lives," Brian Chancellor, Realtor in the Palo Alto office of the Sereno Group, said. "Clients need to know someone is truly in their corner."
Chancellor said he doesn't want to come across as a technology "naysayer". He said real estate agents don't always do the best job explaining their purpose and role in effectively executing real estate transactions.
He said he can see AI as being a potentially valuable tool for Realtor newcomers building up their businesses.
"But, pictures can't tell you everything about a property," Chancellor said. "And an agent can turn a client on to a property they might not consider otherwise."
Nicholas French, broker associate in the Los Altos office of Christie's International Real Estate, said he doesn't view AI-related real estate services as competition for his own business.
He related an anecdote where a client he worked with years ago who worked in the high-tech industry became impatient with the uncertainty and sometimes slow pace of searching for a suitable house.
The client decided to strike out on his own, doing most of his searching online. He bought a house within a month. Not long after, the housing market slipped into a downturn.
"He later admitted to me he made a mistake," by hastily buying his house, French said. "Now, we are working together again."
Far more favorable toward using AI assistance is Wajiha Tareen, a Realtor with San Jose-based NextHome Lifestyles. Tareen — a Mountain View resident and veteran agent who spent a decade selling homes overseas in Dubai — works today in a territory ranging from San Jose to Redwood City.
Tareen decided to partner with DwellWell and utilize its AI services to help connect with potential clients. Several months after paying what she described as a "small fee" and posting a profile on the DwellWell site, Tareen had an online meeting with a family from Berkeley looking to relocate closer to the father's job at Netflix in Los Gatos. They decided to work together.
In a few weeks, Tareen helped the family find a new home in San Jose's Almaden Valley neighborhood, which they moved into last fall.
"It all worked very smoothly for me and the family," Tareen said. "I'm super positive about the experience."