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How AI is changing the competitive real estate market

From AI generated floorplans to predicting who is most likely to sell a home in the next year, AI is helping agents and consumers.
How AI is changing the competitive real estate market
Posted at 2:33 PM, Jul 31, 2023

"Find me waterfront homes in central Minnesota."

The future is here in real estate, with a little help from ChatGPT artificial intelligence. Zillow, the real estate information site, is partnering with the AI app to allow users ask conversational questions about specific property listings. Users can also share the types of for-sale and rental homes they are interested in, including details like location and price range, and get results back from the app.

Much like how the internet changed how real estate is marketed and sold, AI is now transforming the home buying experience. The new AI real estate plugin retrieves relevant information from Zillow's database of real estate listings when asked a question.

The plugin became available to a select number of ChatGPT users in May, before it rolled out more widely. Plugins are software additions that allow for the customization of computer programs, apps, and web browsers, as well as the customization of the content offered by websites. 

"Generative AI is changing the way people search for information,” David Beitel, chief technology officer at Zillow, said in a statement. “We've been embracing AI and machine learning starting with the Zestimate in 2006, and later introducing personalized recommendations and natural language search — which means we're well-equipped to help customers search and find homes in this new way." 

But is new technology the solution to find homes? Megan Fox, an agent at Compass Real Estate in New Jersey, said in this competitive market with inventory being extremely low, a local real estate expert is critical in helping navigate the process. 

“AI is great for certain things, but a local agent is crucial for getting to know the area,” Fox said. “Our kids go to school here, we know the restaurants, the neighborhood.”  

Paul Reddam, of Homesville Realty Group with Compass in Austin, Texas, said that it’s important to have the best technology and tools available to efficiently manage the home search process. One of his favorite AI tools is the likely-to-sell feature that Compass agents use. Likely-to-sell recommendations help agents in engaging with the right contacts — people in the area who have the highest likelihood of selling their homes in the next 12 months.

SEE MORE: Young buyers weigh options as they struggle to afford today's housing

The AI tool Zillow is offering through ChatGPT allows home buyers and sellers to connect their real estate needs: buying, selling, financing and renting. Using natural language search queries, the tool helps buyers find exactly what they’re looking for.

Other AI features that Zillow recently added include AI generated floor plans for listed homes.  

The Zillow ChatGPT plugin is currently building its data, allowing Zillow to refine the user experience based on user interactions. OpenAI, the maker of ChatGPT, has put in safeguards to minimize inaccuracies and prevent inappropriate responses. 

Digital tools are great for navigating the home search process, Fox said. But she added they are best when used with guidance from a local real estate agent who can decipher nuances of the market.        

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